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Whit Water

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Submitted By apps37
Words 2157
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Case Study: Lawsons
COMM 1007
Caleb Apperson
Student number: 0311103
Wednesday, January-29-14

Executive Summary Every company is going to face its hardships from time to time the ability to handle the problems learn from them and grow is the difference between companies who become successful and the ones who go bankrupt. There are different ways to asses a company’s value, future plan. Investors look at certain ratios to determine the risk associated with investing their money in hopes of a return. This situation is from the banks perspective.
Paul MacKay has put in a request for obtain a loan of $194 000 along with a $26 000 line of credit to help him in the months of low cash. The person in charge of making this decision is Jackie Patrick a newly appointed loan officer for the commerce bank. This decision is an interesting one because it is not a simply yes or no; many different areas come into factor. Lawsons future is on the line, who is a big business partner with Forsyth. Jackie will be judge on her decision by peers, coworkers, and the community. Mr. Mackay is a well-respected individual in the community with a good reputation. Jackie needs to determine if the loan is too large of a risk for bank or if there is opportunity to have a successful future. She has a couple different options, allow the request, deny the request, and allow the request on certain conditions/requirements. Give alternate offer. She will determine this by looking at profitability, liquidity, efficiency, stability, growth. The major areas used to determine the success of a company. The 4 C’s of credit used to determine is someone is worthy of a loan; character, conditions, collateral, payback capacity. Also use the project balance and income statement of Lawsons for 2004.The best option for everyone is to grant the request on the loan with certain requirements/guarantees’

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