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Club Loop Corporation (CL) is a large owner, operator, and developer of golf clubs and resorts. The company is privately owned by several wealthy individuals. During the current year, according to the draft financial statements, revenues increased by 7.2% and net operating income increased by 13% to $22.5 million. Net income dropped from $2.9 million to $822,000. The decrease was largely due to two events: a change in accounting policy and costs related to the settlement of a lawsuit. One of the company's objectives is to always ensure that capital resources are readily available to meet approved capital expenditures and to take advantage of growth opportunities. According to the draft year-end financial statements, the company has current assets of $12 million and current liabilities of $28 million, resulting in a working capital deficit. Included in the current liabilities are long-term debts that are currently due. The company is working with the financial institutions in question to renew or replace these facilities. CL has received unsolicited expressions of interest from several financial institutions concerning these facilities, and management believes that these facilities will be replaced- hopefully before the current financial statements are issued. The company owns most of the land on which CLJs golf courses are developed. Currently, the company follows a rigorous "weed and feed" program in order to keep the grass on the golf courses in top shape.

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