Paul Sabin organized Sabin Electronics 10 years ago to produce and se several electronic devices on which he had secured patents. Although the company has been fairly profitable, it is now experiencing a severe cash shortage. For this reason, it is requesting a $570,000 long-term loan from Gulfport State Bank, $135,000 of which will be used to bolster the Cash account and $435,000 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: 98,000 220,000 Cash Marketable securities 25,000 568,000 Accounts receivable, net 370,000 665,000 1,015,000 Inventory Prepaid expenses 26,000 29,000 Total current assets 1,707,000 1,309,000 1,400,000 Plant and equipment, net 1,686,200 $3,393,200 2,709,000 Total assets Liabilities and Stockholders Equity Liabilities: Current liabilities 835,000 500,000 600,000 600,000 Bonds payable, 12% Total liabilities 1,435,000 1,100,000 Stockholders' equity: Common stock, $15 par 00,000 900,000 Retained earnings 1,058,200 709,000 1,609,000 Total stockholders' equity 1,958,200 $3,393,200 2,709,000 Total liabilities and equity