Analyze the company's performance and performance trends. Include the following in your analysis:

1. Analyze the trend for accounts receivable collections.
   1. Identify the trend.
   2. Explain the relevance of the trend.
   3. Determine if the trend is improving or getting worse.
2. Compare the company's average inventory turnover to the industry average inventory turnover rate. Note that the average industry turnover rate for Ace Company is 10 times per year.
   1. Consider whether the company's average inventory turnover is higher or lower than the industry average.
   2. Explain whether a higher or lower average is better.
   3. Determine whether the trend is improving or getting worse.
3. Evaluate the company's short-term and long-term credit worthiness based on financial performance and trend (comparing this year to last year). Include in your evaluation:
   1. Information about performance and trends.
   2. Information about other relevant financial information you consider important to the decision.
   3. Your recommendation regarding whether the bank should grant the loan based on the financial data.Competency 1: Explain how accounting concepts and practices impact financial reporting.
   4. Analyze the trend for the company's accounts receivable collections.
   5. Compare the company's average inventory turnover ratio to an industry average.

• Competency 2: Apply principles of accounting to assess financial performance.
  • Evaluate the company's short-term and long-term credit worthiness.
• Competency 4: Communicate financial information with multiple stakeholders.
  • Communicate accounting information clearly.

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Ace Company Data The company's financial data is condensed from the financial statements of Ace Company. Both the Income Statement and Balance Sheet tables are for 2016 and 2017, ending December 31. Inventory at December 31, 2015, was $4,800,000. Accounts receivable at December 31, 2015 was $3,800,000. The market price of the common stock was $104 per share at December 31, 2017, and $81 per share at December 31, 2016. There were no changes in the number of shares of common stock during 2017, 2016, or 2015. There are no shares of preferred stock. There are no stock options, convertible debt, or other possible sources of common stock. Cash dividends of $1,000,000 ($2.00 per share) were paid in both 2017 and in 2016. All sales are made on credit. Note: All dollar amounts in tables are in thousands of dollars.

Assets	2017	2016
cash	$2,547	$1,800
accounts receivable	$4,000	$3,900
inventories	$6,000	$5,000
property, plant & equipment, net of accumalated depreciation	$10,000	$9,800
other long term assests	$1,000	$1,000
Total assets	$23,547	$21,500

Liabilities and equity	2017	2016
current liabilities	$7,000	$7,000
long term liabilities	$9,800	$10,000
common stock, no par, 500,000 shares issued outstanding	$2,000	$2,000
Retailed earning	$4,747	$2,500
Totaly liabilities and equity	$23,547	$21,500