Question 2 Freedom Bank has received a loan application from a private company Automatic Corporation. An abbreviated portion of the financial information provided by the company is shown below: Total assets EBIT Net working capital Book value of equity Accumulated retained earnings 320,000 Total liabilities $1,260,000 158,000 84,000 360,000 1,140,000 What is the Z-score for Automatic Corporation? What does the score predict?
Question 2 Freedom Bank has received a loan application from a private company Automatic Corporation. An abbreviated portion of the financial information provided by the company is shown below: Total assets EBIT Net working capital Book value of equity Accumulated retained earnings 320,000 Total liabilities $1,260,000 158,000 84,000 360,000 1,140,000 What is the Z-score for Automatic Corporation? What does the score predict?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Question 2
Freedom Bank has received a loan application from a
private company Automatic Corporation. An abbreviated
portion of the financial information provided by the
company is shown below:
Total assets
EBIT
Net working capital
Book value of equity
Accumulated retained earnings
320,000
Total liabilities
$1,260,000
158,000
84,000
360,000
1,140,000
What is the Z-score for Automatic Corporation? What
does the score predict?
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