CASE Raysut Cement has applied for a loan from the Bank Muscat in order to invest in several potential opportunities. In order to evaluate the firm as a potential debtor, the bank would like to compare Raysut Cement to the industry. The following are the financial statements given to Bank Muscat. The amount given is million OMR. Balance Sheet Cash Accounts receivable Inventory Current assets Plant and equipment Less: acc depr Net plant and equipment Total assets Notes payable Current liabilities 12/31/2019 OMR 305 275 600 1,180 1,700 Liabilities and Owners' Equity Accounts payable Bonds Owners' equity Common stock Paid-in-capital (500) 1,200 2,380 Retained earnings Total owners' equity 150 125 275 500 165 775 665 1,605 Liabilities +Owners 'Equity 2,380 12/31/2020 OMR 270 290 580 1,140 1,940 (600) 1,340 2,480 CORE 200 0 200 500 305 775 700 1,780 2,480 Income Statement Sales (100% credit) Cost of goods sold Gross profit Operating expenses Depreciation Net operating income 2019 OMR 1,100 600 500 20 160 320 Interest expense Net income before taxes Taxes Net income 64 256 87 169 2020 OMR 1,330 760 570 30 200 340 57 283 96 187 Industry Norms for 2019 and 2020 are given below, Current ratio Average collection period Debt ratio Times interest earned Total asset turnover Operating profit margin Net profit margin Industry Norms 5.0 90 days .33 7.0 .75 20% 12% Required: Write report and analyze the following, A. Do company applied for loan have sound liquidity position? B. Comment on Account receivable collection policy over period of two years. C. Comment on the sources of financing for Raysut Cement. State in your report, how the financing mix of that company has changed over period of time? D. Do Raysut Cement able to pay their interest expense if the loan provided by Bank Muscat? E. Comment on company profitability. What is wrong with operating expenses, manufacturing cost, cost of goods sold and other expenses over period of two years? F. Do bank Muscat should lend money to Raysut Cement?