Answered step by step
Verified Expert Solution
Question
1 Approved Answer
From my industry research on Chester, I've learned that senior management intends to fully fund a new technology purchase by issuing 75,000 shares of stock
From my industry research on Chester, I've learned that senior management intends to fully fund a new technology purchase by issuing 75,000 shares of stock as well as a new bond issue at the beginning of next year. My forecast indicates that this will increase Chester's leverage (assets/equity) to 2.12. I'm now examining the effects that this investment plan will have on Chester. If we assume that the stock is issued at yesterday's stock price of $40.19, which of the following conclusions are correct? I'd estimate that a third of these are right. Ronald Ronald Jefferson Board Member, Accounting \& Finance | Andrews Corporation Choose all responses that apply. Chester will issue stock totaling $3,014,250. The Chester Working Capital will be unchanged at $18,440,000. Long term debt will increase from $48,250,000 to $51,264,250 The Chester bond issue will be $3,375,960. Total Assets will rise to $173,706,970. Total investment for Chester will be $6,390,210. I was reviewing some industry sales numbers and became interested in Bead. Although Bead is sold in other segments, it is specifically designed for the Low End segment. l'd like to forecast the demand for Bead. To keep this simple, let's assume that all policies (i.e., R\&D, Marketing, and Production) for all competitors will remain constant and that all 2416 of units of Bead are sold in the Low End segment. If overall competition also remains constant, what will be the demand next year for Bead (in 000's)? As always, I appreciate your time and support. Michelle Michelle Cho Board Member, Strategy | Andrews Corporation 5522 units 2416 units 3797 units 2761 units
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started