BUTLER LUMBER CO.

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If we take a look at our profits, we seem to be doing fine. But we really wonder where our cash is going, because it decreases as sales grow, and we do not understand the reason. Could you help us? Why do we need increasing loans, if our sales grow? Do you think that 465.000$ credit line will be enough to achieve an increase of sale of 30%? Make your Income statement and balance sheet forecast to check it. If you can balance the balance sheet with that amount or less, it will be enough. Do you think that our company should keep on growing at this rate? Would you recommend any change in our strategy? Do you find its capital structure adequate or maybe too risky? If you were the bank, would you approve our loan? Is it highly risky? Why?