Bradburn Corporation was formed five years ago through an initial public offering (IPO) of common shares. Daniel Brown, who owns 15% of the common shares, was one of the organizers of Bradburn and is its current president. The company has been successful, but it is currently experiencing a shortage of funds. On June 10, 2017, Daniel Brown approached the Hibernia Bank, asking for a 24-month extension on two $35,000 notes, which are due on June 30, 2017 and September 30, 2017. Another note of $6,000 is due on March 31, 2018, but he expects no difficulty in paying this note on its due date. Brown explained that Bradburn's cash flow problems are due primarily to the company's desire to finance a $300,000 plant expansion over the next two fiscal years through internally generated funds. The commercial loan officer of Hibernia Bank requested financial reports for the last two fiscal years. These reports are reproduced below.

Instructions
(a) Calculate the following items for Bradburn Corporation.
1. Current ratio for fiscal years 2016 and 2017.
2. Quick (acid-test) ratio for fiscal years 2016 and 2017.
3. Receivables turnover for fiscal year 2017.
4. Inventory turnover for fiscal year 2017.
5. Asset turnover for fiscal year 2017.
6. Gross profit percentage for fiscal years 2016 and 2017.
7. Profit margin on sales for fiscal years 2016 and 2017.
8. Return on assets for fiscal years 2016 and 2017. (Assume total assets were $1,688,500 at March 31, 2015.)
9. Return on common share equity for fiscal years 2016 and 2017. (Assume total equity was $1,499,000 at March 31, 2015.)
10. Earnings per share for fiscal years 2016 and 2017.
11. Payout ratio for fiscal years 2016 and 2017.
12. Debt to total assets for fiscal years 2016 and 2017.
13. Book value per shares for fiscal years 2016 and 2017.
14. Percentage change in sales, cost of goods sold, gross margin, and net income after tax from fiscal year 2016 to 2017.
(b) Identify and explain what other financial reports and/or financial analyses might be helpful to the commercial loan officer of Hibernia Bank in evaluating Daniel Brown's request for a time extension on Bradburn's notes.
(c) Assume that the percentage changes experienced in fiscal year 2017 as compared with fiscal year 2016 for sales and cost of goods sold will be repeated in each of the next two years. Is Bradburn's desire to finance the plant expansion from internally generated funds realistic? Discuss.
(d) Should Hibernia Bank grant the extension on Bradburn's notes considering Daniel Brown's statement about financing the plant expansion through internally generated funds? Discuss.

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BRADBURN CORPORATION Statement of Financial Position March 31 2017 2016 Assets Cash Notes receivable Accounts receivable (net) Inventories (at cost) Plant and equipment (net of depreciation) Total assets $ 18,200 148,000 131,800 105,000 1,449,000 $1,852,000 $ 12,500 132,000 125,500 50,000 1,420,500 $1,740,500 Equity and Liabilities Share capital common (130,000 shares $1,300,000 $1,300,000 issued) Retained earnings (note 1) Accrued liabilities Notes payable (current) Accounts payable Total equity and liabilities 388,000 9,000 76,000 79,000 $1,852,000 282,000 6,000 61,500 91,000 $1,740,500 Note 1: Cash dividends were paid at the rate of $1 per share in fiscal year 2016 and $2 per share in fiscal year 2017 BRADBURN CORPORATION Income Statement For the Fiscal Years Ended March 31 2017 2016 Sales Cost of goods sold (note 2) Gross margin Operating expenses Income before income tax Income tax (30%) Net income $3,000,000 $2,700,000 1,425,000 $1,470,000 $1,275,000 780,000 610,000 495,000 148,500 $427,000 346,500 1,530,000 860,000 183,000 Note 2: Depreciation charges on the plant and equipment of $100,000 and $102,500 for fiscal years ended March 31, 2016 and 2017, respectively, are incluced in cost of goods sold.