Simone Smith, trading as Scents of Jamaica, is applying for a small-business loan. She provides the bank with the following information: cash in checking account, $5,000; short-term investments, $10,350; real estate with market value, of $1 15,500; Inventory $30,000; first mortgage on real estate, $25,000; home equity loan limit, $70,000; balance on home equity loan, $10,000: value of home $200,000; automobile with market value of $19,000; automobile loan outstanding, $15,000; credit card debt, $1,500. (a) Using the information provided, construct a statement of affairs (personal balance sheet) for Simone Smith, trading as Scents of Jamaica. The statement should be arranged to show the assets and liabilities in their various categories eg. current assets being a category. (5 Marks) (b) The bank's policy says that a debt ratio of 20% or less is acceptable for small business loans. Using the debt ratio as the sole criterion, would you make a loan of $100,000 to Scents of Jamaica? Show all workings to support your answer. 11:53 am