The original z-score formula intended for public manufacturing companies is shown below: Altman Z-Score = (1.2 X1) + (1.4 X2) + (3.3 X3) + (0.6 X4) + (0.99 X5) The inputs for our z-score calculation are the following: X1 = Working Capital Total Asset X2 = Retained Earnings Total Assets X3 = EBIT Total Assets X4 = Market Capitalization Total Liabilities X5 = Sales Total Assets The following assumptions will be used for our modeling exercise. Current Assets = $60 million Current Liabilities = $40 million Fixed Assets = $100 million Net Income = $10 million Dividends = $2 million Sales = $60 million COGS and SG&A = $40 million P/E Multiple = 8.0x Total Liabilities = $120 million What is the Z-score? a. Since the z-score of 1.40 is below 1.81, our company is in the Safe Zone, where the risk of near-term insolvency is low. b. Since the z-score of 1.40 is below 1.81, our company is in the Distress Zone, where the risk of near-term insolvency is high. c. Since the z-score of 1.81 is below 3.0, our company is in the Distress Zone, where the risk of near-term insolvency is high. d. Since the z-score of 1.81 is above 1.0, our company is in the Distress Zone, where the risk of near-term insolvency is low