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INTRODUCTION The Butler Lumber Comp any (BLC) was founded in 1981 as a partnership by Mark Butler and Henry Stark. The vexation is located in a growing suburb of a large city in the Pacific Northwest. Its operations were exceptional to the retail distribution of lumber products in the local area. Their exemplary products included plywood, moldings, and sash and door products. Quantity discounts and credit cost of net 30 days on open account statement were usually offered to customers. Due to careful control of operating expenses and by quantity purchases of materials at substantial discounts, sales volume had been built up largely on the basis of successful set competition. Moldings and sash and door products constituted significant items of sales, very much of which were utilize for repair work. In 1988 Butler bought out Starks interest and incorporated the business. To pay out Starks note of $105,000 by 1989, a major portion of the monetary resource were raised by a loan of $70,000 in latterly 1988. This loan carried an interest rate of 11% repayable in quarterly installments of $7000/year over the next 10 years. The phoner has been experiencing rapid growth during recent years. Despite good profits, it is lining shortage of cash and found it necessary to increase its espousal from the Suburban National Bank to $247,000.

The maximum loan provided to any borrower by this bank is $250,000. Recently, having being introduced to George Dodge, an officer of a much larger bank called the Northrop National Bank; Butler tentatively discussed the possibility that Northrop Bank might extend a business enterprise of credit to the Butler Lumber up to a maximum amount of $465,000. After this discussion, Dodge arranged for the credit plane section of Northrop Bank to investigate Butler and his company. The Northrop Bank sent inquiries to a number of firms dealing with Butler Lumber Company including dealers, suppliers and traders. every last(predicate) had good opinions about Butler and his company. The bank gave particular precaution to the... If you want to get a full essay, order it on our website: Ordercustompaper.com

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