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It is January 2nd and senior management of Baldwin meets to determine their investment plan for the year. They decide to fully fund a plant

It is January 2nd and senior management of Baldwin meets to determine their investment plan for the year. They decide to fully fund a plant and equipment purchase by issuing $10,000,000 in bonds. Assume the bonds are issued at face value and leverage changes to 2.7. Which of the following statements are true?

Select all that apply. Select: 3

Baldwins long-term debt will rise by $9,000,000

Total liabilities will be $131,239,678

Working capital will remain the same at $15,965,674

The total investment for Baldwin will be $201,261,631

Total Assets will rise to $216,059,272

image text in transcribed

Balance Sheet SSETS 2016 2017 Common Size 18.4% 57% 35% DEFINITIONS: Common Size: The common ize column simply represents each item as a ercentage of total assets for that year. Cash: our end-of-year cash position. Accounts Cash Accounts Receivable $36,951 $11,522 $7,228 $18,152 $9,387 $12,198 Receivable: Reflects the lag between delivery nd payment of your products. Inventories: The Inventory urrent value of your inventory across all roducts. A zero indicates your company tocked out. Unmet demand would, of course, all to your competitors. Plant & Equipment: he current value of your plant. Accum Deprec: Accumulated Depreciation he total accumulated depreciation from your lant. Accts Payable: What the company urrently owes suppliers for materials and ervices. Current Debt: The debt the company Total Assets s obligated to pay during the next year of perations. It includes emergency loans used to LIABILITIES & OWNERS eep your company solvent should you run out EQUITY f cash during the year. Long Term Debt: The ompany's long term debt is in the form of onds, and this represents the total value of your current Debt onds. Common Stock: The amount of capital Long Term Debt nvested by shareholders in the company. otal Current Assets $55,701 277% $39,737 $215,7600 ($70,200) $165,300 ($57,176) Plant & Equipment 107.2% -34.9% otal Fixed Assets $145,560 723 $108,124 $201,262 100.0% $147,861 $6,390 $21,740 $59,153 ccounts Payable $7,028 $32,708 $81,504 3510 16.3% 40.5% Retained Earnings: The profits that the otal Liabilities $121,2400 60.2% $87,283 ompany chose to keep instead of paying to hareholders as dividends $36,672 $43,350 18.2% 21.5% $18,647 $41,931 ommon Stock Retained Earnings Total Equity Total Liab. & O. Equity $80,022 39.8% $60,578 $201,26.2 100.0% $147,861

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