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Loan Request (what is asked for) = $125,000 Net Income from Operations (NFIO) = $720,000 Current Liabilities = $43,000 Total Assets = $1,250,000 Current Assets

  • Loan Request (what is asked for) = $125,000
  • Net Income from Operations (NFIO) = $720,000
  • Current Liabilities = $43,000
  • Total Assets = $1,250,000
  • Current Assets = $38,000
  • Equity = $425,000
  • Nonfarm Income = $28,000
  • Return on Farm Assets = 2.7%
  • Collateral Value = $170,000
  • Depreciation Expense = $54,500
  • Management is considered average
  • Taxes = $41,000
  • Withdrawals for Personal Use = $61,000
  • Withdrawals for College and College Related Expenses = $32,000
  • Interest on All Farm Loans = $21,400
  • Cash Repayment on Term Debt = $24,000
  • Replacement Margin = $31,000
  • Cash Paid to Purchase Machinery = $24,000
  • Operating Ratio = 0.55

Using the dual ratings system and the attached table, find the weighted score and the probability of default. You will have to determine the correct table.

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