5) Suppose that Light Ltd, has approached your bank and wants to borrow C250,000 in working capital. The firm provides you with the following balance sheet and income statement data as shown table 1 below: Table 1 Assets Liabilities and Equities Cash 55,000 Accounts payable 166,000 Accounts 380,000 Accrued expenses 37,000 receivable Inventory 510,000 Notes payable 71,000 Fixed assets 928,000 Current maturity of 25,000 long-term debt Total assets 1,873,000 Long-term debt 475,000 Equity 1,082,000 Total liabilities and equity 1,856,000 Sales 4,622,800 Cost of goods sold 3,504,100 Operating 893,000 i. ii. iii. iv. expenses Purchases 3,116,000 What fraction of the firm's current assets is (implicitly) funded with long-term debt or equity? What is the significance of the figure obtained in if it is large versus small? [6 marks] Assuming a 365-day year, estimate the firm's working capital loan needs. [10 marks] What general concerns might you have regarding this loan request? [5 marks] Suppose that the typical publishing firm in this industry has just one-half the amount of equity that Light Ltd has. How will this affect key industry ratios and the working capital needs, in general? [4 marks]