Bonus Assignment Part 1 You work at RBC bank and are in charge of approving loans. Rawhides Co, a company who has been in business for a few years has requested for a loan of $50,000. They have provided you the financial statement for the current and prior year. As follows Rawhides Co Balance Sheet For year ended December 31 2023 2023 2022 Current Assets Cash & Cash equivalents AR 5819 2682 Inventories 5000 1600 Prepaid Expenses 528 Total current assets 11347 4282 Long term Asset Property, Plant, Equipment 351520 216250 Total Assets 362867 220532 Current Liabilities Bank overdraft 15238 15056 Accounts Payable 12505 3500 Current portion of Long term loan 2500 2500 Total current liabilities 30243 21056 Long term liabilities Long term Loans 45000 45000 Retained Earnings Common shares 100 issued 100 Retained Earnings 287524 100 154376 Total Liabilities & Retained Earnings 362867 220532 Sales COGS Rawhides Co Income Statement For year ended December 31 2023 2023 2022 15050 5000 15000 4500 50 500 Gross margin Operarting expenses Advertisement 2000 1500 Rent 1200 1200 Interest Expense 800 759 Utilities 800 758 Wage 9000 8500 13800 12717 NI/ (Loss) before tax Tax NI/(Loss) -13750 -12217 -13750 -12217 Use ratios and analysis to discuss whether you would provide this company a loan. Below is Industry average on similar companies Coment ratio 1.61 Times interest earned 50 times Quick ratio LE:1 Profit margin 14% Accounts receivable turnover 16 times Gross profit ratio 18% Days' sales uncollected 21 days Return on total assets 20% Investory turnover 5 times Return on common shareholders' equity 12.7% Days' sales in inventory 70 days Book value per common share $8.63 Total asset turnover 2.3 times Book value per preferred share $15.00 Accounts payable over 4 times Earnings per share $1.79 Delt ratio 35% Price-earnings per share 18.2 Equity ratio 65% Dividend yield $0.35 Pledged assets to secured liabilities 14:1