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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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