You are a loan manager at Norm bank, you have the following loan application to review. The bank uses Altmans Z-score to assess the loan acceptability. An AA-rated, one-year business loan from a firm with the following financial statement information (in millions of dollars). Should the bank accept the loan?

Assets ($)		Liabilities and equity ($)
Cash	30	Accounts payable	50
Accounts receivables	100	Notes payable	45
Inventory	200	Accruals	50
		Long-term debt	500
Plant and equipment	1000	Equity (retained earnings =$200)	685
Total assets	1330	Total liabilities and equity	1330

Also assume sales = $1250m, cost of goods sold = $930m and the market value of equity is equal to 2 times the book value of equity. Norm Bank uses the Altmans Z-score model to evaluate AA-rated loans.