QUESTION: As his banker, would you be willing to lend to Mr. Cartwright? Why? Explain. (It might be useful to question his growth rate of 25% at this point.)

Exhibit 1 Operating Statements for Years Ending December 31, 2001-2003, and for First Quarter 2004 (thousands of dollars) Source: Case author. an the first quarter of 2003 sales were $698,000 and net income was $7,000. b Operating expenses include a cash salary for Mark Cartwright of $75,000 in 2001, $85,000 in 2002, $95,000 in 2003, and $22,000 in the first quarter of 2004 . Cartwright also received some of the perquisites commonly taken by owners of privately held businesses. Exhibit 2 Balance Sheets at December 31, 2001-2003, and March 31, 2004 (thousands of dollars)