Paul Sabin organized Sabin Electronics 10 years ago to produce and sell several electronic devices orn which he had secured patents. Although the company has been fairly profitable, it is now experiencinga severe cash shortage. For this reason, it is requesting a $640,000 long-term loan from Gulfport State Bank, $170,000 of which will be used to bolster the Cash account and $470,000 of which will be used to modernize equipment. The company's financial statements for the two most recent years follow Sabin Electronics Comparative Balance Sheet This Year Last Year Assets Current assets: $ 126,000 Cash Marketable securities Accounts receivable, net Inventory Prepaid expenses 659,000 1,020,000 34,000 290,000 11,000 440,000 735,000 36,000 Total current assets Plant and equipment, net 1,839,000 2,084,600 1,512,000 1,470,000 Total assets $3,923,600 $2,982,000 Liabilities and Stockholders Equity Liabilities: Current liabilities Bonds payable, 12% $ 870,000 800,000 440,000 800,000 Total liabilities 1,670,000 1,240,000 Stockholders' equity: Common stock, $15 par Retained earnings 690,000 1,563,600 690,000 1,052,000 1,742,000 $3,923,600$2,982,000 Total stockholders' equity 2,253,600 Total liabilities and equity