Thomas Bradshaw is thinking about starting his own business, Bradshaw Sports. At the beginning of October 20X1, he plans to invest \(\$ 30000\) into the business. During October the business will purchase land, a small building to house the business, office equipment and supplies. Thomas has found land and a building that would be suitable with a purchase price of \(\$ 99000\) including GST. Thomas estimates that the cost of the land is 15 per cent of the total price and the building is 85 per cent. Bart wants the business to 'finance' this purchase through its bank. The bank would require Bradshaw Sports to make a 20 per cent down payment and also require the business to sign a mortgage for the balance. Thomas has determined that there is too much land, so if Bradshaw Sports purchased the land and building it would sell one-quarter of the land to another business to use for parking. The other business has agreed to buy the land at a price equal to the cost paid by Bradshaw Sports and to sign a note requiring payment at the end of two years. Thomas has found some used office equipment that could be purchased by Bradshaw Sports for \(\$ 2970\) including GST on credit, to be paid in 60 days. He also expects that Bradshaw Sports will need \(\$ 1320\) of office supplies including GST, which the business would purchase with cash. Before the bank will lend Bradshaw Sports the money to buy the land and building, it has requested a 'projected' balance sheet for the business, along with a 'projected' current ratio and debt ratio as of 31 October 20X1, based on the preceding plans. Thomas Bradshaw has asked for your help. Required:

a Using the preceding information, prepare a projected balance sheet, current ratio and debt ratio for Bradshaw Sports as of 31 October 20X1. Show supporting calculations.

b Basing your decision solely on this information, if you were the banker would you give Bradshaw Sports the loan? What other information would help you make your decision?