7 Problem 14-19 (Algo) Financial Ratios for Assessing Profitability and Market Performance [LO14-5, LO14- 6] 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 $530,000 long-term loan from Gulfport State Bank, $115,000 of which will be used to bolster the Cash account and $415,000 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 Assets Current assets: Cash Marketable securities Accounts receivable, bet Inventory Prepaid expenses Total current assets Plant and equipment, net Total assets Liabilities and Stockholders' Equity Liabilities: Current liabilities Bonds payable, 12 Total liabilities Stockholders' equity: Common stock, $15 par Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $ 82,000 0 516,000 980,000 22,000 1,600,000 1,570,200 $ 180,000 21,000 330,000 625,000 25,000 1,181,000 1,400,000 $ 3,170,200 $ 2,581,000 $ 815,000 750,000 1,565,000 720,000 885,200 1,605,200 $ 3,170,200 $ 460,000 750,000 1,210,000 720,000. 651,000 1,371,000 $ 2,581,000