Super Melody Art Production Ltd, is a music and art production enterprise, aymong the business activities the company is involved in are: Video clips production, ampt singing the cercmonies, CD's cassettes production, contracts with singers, music recording. studio works, cuitural events and festivals organization and promotional activities. The company was established 5 years ago among 3 partners mainly entrepreneurs with limited capital, but due to tense competition in the industry and huge number of new singers in addition to emerging new specialized TV station in this domain, the company management was very optimistic of the future outcome of the business concern; due to such results two new Gulf partners were introduced in 2003 into the company with fresh funds for $3.5M il injected into the business. In present time, the company is facing some financial difficulties with respect to attracting some well known stars / singers. The, industry is highly competitive especially with the availability of so many singers but limited numbers of talented and favored singers, The management team is very cautious whether to invest in stars i.e. signing contracts with high reputable and well known singers or investing in hi-tech equipment to furnish the company's studio. The decision tended towards the second option, such action made some managers to regret being in the company. Year 2003 was not a good year for the company due to expiry of some contracts with major singers and no financial capability is available at that time to renew. The company management approached you as a credit officer at their sole bank, requesting increase of bank credit facilities from $850,000 to $2Mil. The facilities will be utilized to finance production contracts with some popular singers expecting to achieve a breakthrough in the world of singing. Questions: - Analyze the financial position of the company and determine the major drawbacks and strengths of the company. In your opinion was it a wrong decision to launch a renewal of the company's studio? - Assess the industry threats, opportunities, weaknesses and strengths. - Would you approve the increase in the credit facilities and in what form/structure why? - Would you recommend the company to enter any future business activities? Suggest