10.00 points Paul Sabin organized Sabin Electronics 10 years ago to produce and sell several electronic devices on which he had secured patents. Although the company has been fairly profitable, it is now experiencing a severe cash shortage. For this reason, it is requesting a $550,000 long-term loan from Gulfport State Bank, $125,000 of which will be used to bolster the Cash account and $425,000 of which will be used to modernize equipment. The company's financial statements for the two most recent years follow: Sabin Electronics Comparative Balance Sheet This Year Last Year Current assets: Cash 542,000 995,000 22,000 $ 90,000 200,000 23,000 350,000 645,000 27,000 Accounts receivable, net Prepaid expenses Total current assets Plant and equipment, net 1,649,000 1,638,000 1,245,000 1,420,000 Total assets $3,287,000 2,665,000 Liabilities and Stockholders Equity Liabilities: Current liabilities Bonds payable, 12% $ 825,000 480,000 850,000 850,000 Total liabilities 1,675,000 1,330,000 Stockholders' equity: Common stock, $20 par 740,000 872,000 740,000 595,000 1,335,000 $3,287,000 2,665,000 Total stockholders' equity 1,612,000 Total liabilities and equity