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Attached you will find select financial data for Morgan Creek, a motion picture production company based in Los Angeles, California. Using the various ratios provided
Attached you will find select financial data for Morgan Creek, a motion picture production company based in Los Angeles, California. Using the various ratios provided in the file, please review the data and offer your overall assessment as to the company's financial health. What trends do you notice? Are there any storm clouds on the horizon?
Balance Sheets | ||||
Four Years Ago | Current Year | |||
Assets: | ||||
Cash | $ 28,000 | $ 7,100 | ||
Accounts Receivable | 170,100 | 236,800 | ||
Inventory | 157,200 | 246,100 | ||
Total Current Assets: | 355,300 | 490,000 | ||
Building and Equipment | 67,100 | 74,800 | ||
Allowance for Depreciation | 18,200 | 48,900 | 26,100 | 48,700 |
Other Assets | 18,500 | 23,700 | ||
Total | $ 422,700 | $ 562,400 | ||
Liabilities and Capital: | ||||
Accounts Payable | $ 61,700 | $ 125,700 | ||
Notes Payable - trade | - | 14,800 | ||
Notes Payables - bank | 25,000 | 60,000 | ||
Other Liabilities | 18,300 | 26,100 | ||
Total Current Liabilities: | 105,000 | 226,600 | ||
Mortgage (5%) | 16,200 | 9,600 | ||
Shareholders' Equity | 301,500 | 326,200 | ||
Total | $ 422,700 | $ 562,400 | ||
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