Dry Supply's income and balance sheet spreads, plus the company's UCA cash flow model are provided in Appendix A. Answer the following questions using Dry Supply's * financial information and what you have studied about loan structuring. 1. Is this loan request consistent with the profile of a typical wholesaler? 2. Based on the purpose of the loan and the use of funds, what type of borrowing arrangement(s) is (are) most appropriate? 3. Using the financial data, what are feasible repayment terms for Dry Supply for the appropriate borrowing arrangement you identified? Dry Supply's fixed assets The fixed assets for Dry Supply are summarized below. The company does not own its land or building. Fixed assets are composed primarily of company vehicles and equip- ment used to test products. With fixed assets heavily depreciated, the lender better understands the request for new equipment. In 20xz, Dry Supply added a used delivery truck at a cost of $15,000. 20xx $76 $78 1 0 53 Furniture and fixtures Leasehold improvements Transportation equipment Gross fixed assets Less: Accum. depreciation Net fixed assets Percent depreciated 31.3% 0.4% 21.8% 53.5% 35.0% 18.5% 65.0% 20xy $75 28.8% 0.4% 70 26.9% $146 56,2% 97 37.3% $49 18.8% 66.0% 85 $163 20xz 28.9% 0.0% 31.5% 60.4% 40.7% 19.6% 67.0% $130 85 110 $53 $45 Dry Supply's income and balance sheet spreads, plus the company's UCA cash flow model are provided in Appendix A. Answer the following questions using Dry Supply's * financial information and what you have studied about loan structuring. 1. Is this loan request consistent with the profile of a typical wholesaler? 2. Based on the purpose of the loan and the use of funds, what type of borrowing arrangement(s) is (are) most appropriate? 3. Using the financial data, what are feasible repayment terms for Dry Supply for the appropriate borrowing arrangement you identified? Dry Supply's fixed assets The fixed assets for Dry Supply are summarized below. The company does not own its land or building. Fixed assets are composed primarily of company vehicles and equip- ment used to test products. With fixed assets heavily depreciated, the lender better understands the request for new equipment. In 20xz, Dry Supply added a used delivery truck at a cost of $15,000. 20xx $76 $78 1 0 53 Furniture and fixtures Leasehold improvements Transportation equipment Gross fixed assets Less: Accum. depreciation Net fixed assets Percent depreciated 31.3% 0.4% 21.8% 53.5% 35.0% 18.5% 65.0% 20xy $75 28.8% 0.4% 70 26.9% $146 56,2% 97 37.3% $49 18.8% 66.0% 85 $163 20xz 28.9% 0.0% 31.5% 60.4% 40.7% 19.6% 67.0% $130 85 110 $53 $45
