. Baker & Co. has applied for a loan from Trust Bank in order to invest in several potential opportunities. In order to evaluate the firm as a potential debtor, the bank would like to compare Baker & Co. to the industry.

An analyst from the Bank had complied the following ratios for two consecutive years 2008 and 2009 for Baker & Co. The results are given below.

	2009	2008	Industry Avg 2009
Current Ratio	4.3 x	5.7x	5.0x
Acid Test (Quick) Ratio	2.1x	2.8x	3.0x
Inventory Turnover	1.0x	1.31x	2.2x
Avg Collection Period	91.25	80	90
Debt to Total Asset	33%	28%	33%
Times Interest Earned	5.0x	6.0x	7.0x
Total Asset Turnover	.46x	.54x	.75x
Fixed Asset Turnover	.92x	.99x	1.00x
Operating Profit Margin	29.1%	25.6%	20.0%
Net Profit Margin	15.36%	14.06%	12.00%
Return on total Assets	7.10%	7.54%	9.00%
Return on Equity	10.53%	10.51%	10.43%

REQUIRED: Discuss the firm's Strength's and Weaknesses. Include in your explanation as to why you consider the results to be a strength or a weakness. Should the Bank make the loan? Why or why not?