1. Which of the following M-Score characteristics is the most problematic in 2018? Select one. 3 points.

1. DSRI
2. GMI
3. AQI
4. SGI
5. DEPI
6. SGAI
7. LVGI

2013 2014 2015A 2016A 2017A 2018A 2.350 2.692| 1,637 2,691 1,619 398 1 118 1,427 299 M-SCORE Fiscal year INPUT VARIABLES Net Sales CGS Net Receivables Current Assets (CA) PPE (Net) Depreciation Total Assets SGA Expense Net Income (before Xitems) CFO (Cash flow from operations) Current Liabilities Long-term Debt 2711 2.7611 1,674 313 1,042! 137) 53) 2.505! 8151 1331 2,495 1,526 263 1.031 146 1,014 132 1,074 137 371 2.399 7061 2.434 2.622 830 100 2.432 7541 88 296 334 7801 315 816) 123) 216 353 7931 202 3291 1.0971 203 341 854 362) 745) DERIVED VARIABLES Other LIT Assets [TA-(CA+PPE)] 1,352 1,326 1,289 1,254 1,188 1,185 DSRI GMI AQ SGI DEPI SGAI TATA LVGI 0.766 1.012 1.026 1.026 0.963 0.957 -0.072 0.877 0.981 1.005 1.000 0.975 1.038 1.027 -0.038 0.987 0.950 1.010 0.974 0.927 1.177 0.997 -0.086 0.973 1.094 0.988 0.960 0.942 1.073 0.994 0.084 1.007 1.397 0.955 1.096 0.953 1.103 0.972 0.047 0.905 M = -4.84 +.920 D SRI +.528 GM + 404 AQI +.892 SGI +.115 DEPI -172 SGAI + 4.679 TATA -.327 Leverage M-score (8-variable model) -2.95 -2.69 2 .97 -2.86 . 1.87 2013 2014 2015A 2016A 2017A 2018A 2.350 2.692| 1,637 2,691 1,619 398 1 118 1,427 299 M-SCORE Fiscal year INPUT VARIABLES Net Sales CGS Net Receivables Current Assets (CA) PPE (Net) Depreciation Total Assets SGA Expense Net Income (before Xitems) CFO (Cash flow from operations) Current Liabilities Long-term Debt 2711 2.7611 1,674 313 1,042! 137) 53) 2.505! 8151 1331 2,495 1,526 263 1.031 146 1,014 132 1,074 137 371 2.399 7061 2.434 2.622 830 100 2.432 7541 88 296 334 7801 315 816) 123) 216 353 7931 202 3291 1.0971 203 341 854 362) 745) DERIVED VARIABLES Other LIT Assets [TA-(CA+PPE)] 1,352 1,326 1,289 1,254 1,188 1,185 DSRI GMI AQ SGI DEPI SGAI TATA LVGI 0.766 1.012 1.026 1.026 0.963 0.957 -0.072 0.877 0.981 1.005 1.000 0.975 1.038 1.027 -0.038 0.987 0.950 1.010 0.974 0.927 1.177 0.997 -0.086 0.973 1.094 0.988 0.960 0.942 1.073 0.994 0.084 1.007 1.397 0.955 1.096 0.953 1.103 0.972 0.047 0.905 M = -4.84 +.920 D SRI +.528 GM + 404 AQI +.892 SGI +.115 DEPI -172 SGAI + 4.679 TATA -.327 Leverage M-score (8-variable model) -2.95 -2.69 2 .97 -2.86 . 1.87