ASC Enterprise, is a manufacturer of dairy products that was formed three years ago by three brothers who, as directors, retain sole ownership of its ordinary share capital. One-third of the initial share capital was provided by each brother. However, the company has managed to return a profit in each year of operation as shown in the financial statements. ASC Enterprise has an overdraft limit of $3.2 million and pays interest on its overdraft at a rate of 6 percent (6%) per year. The company currently has no long-term debt. Current liabilities consist of trade creditors and overdraft finance in each of the three years as follows: Year 2017 2018 2019 Overdraft ($'000) 50 567 1,167 Trade Creditors ($'000) 400 733 1,133 Interest ? The Industry averages for firms similar to ASC Enterpirse are Net Profit Margin 9% Creditors days 70 days Interest Cover 15 Times Current ratio 2.1 times Stock days 85 days Quick ratio 0.8 times Debtor days 75 days DEBT/Equity ratio 40%(using Book value) I Required: As the newly-appointed Chief Financial Officer of ASC Enterprise write a report to discuss whether the company is likely to be successfulifit approaches its bank FCIB for a loan to undertake a project at a cost of $2.5 million. Your discussion should include an analysis of the current financial position and recent financial performance of the company. Comment on whether the bank should provide ASC Enterprise with the finance and on what basis. Annual Interest should be clearly calculated as part of the leverage analysis. ASC Enterprise Income Statement for the years ending December 31 2019 2018 2017 ($'000) ($'000) ($'000) Revenue 5,200 3400 2600 Cost of Goods sold 4570 2806 2104 Profit before interest & tax 630 594 496 Interest 70 34 3 Earnings before tax 560 560 493 Tax 140 140 123 Net Income 420 420 370 Dividends 20 20 20 Retained profit 400 400 350 ASC Enterprise Balance Sheet as at December 31 2019 2018 2017 (5000) ($'000) ($'000) Fixed Assets 1.600 1,200 800 Current Assets Inventory 1,450 1,000 600 Accounts Receivable 1,400 850 400 2,850 1.850 1.000 Total Assets 4450 3,050 1.800 Current Liabilities 2.300 1.300 450 Ordinary shares 1,000 1,000 1,000 Reserves 1,150 750 350 Total Liabilities & Owners Equity 4,450 3,050 1.800