It is January 2nd and senior management of Digby 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 Save Answer Total Assets will rise to $214,468,986 Total liabilities will be $133,877,963 The total investment for Digby will be $13,127,014 Digby's long-term debt will rise by $10,000,000 Working capital will remain the same at $13,827,646 2019 Income Statement Dune $0 2019 Common Size $146,872 100.0% (Product Name:) Daze Dixie Dot Total ales $27,527 $45,982 $30,925 $26,843 $15,596 $0 $0 ariable Costs irect Labor irect Material $3,858 $12,494$6,863 $5,664$4,300 $10,051 $21,439 $13,154 $10,716 $7,281 $0 $14,110 $34,050 $20,380$16,817 $11,582 $33,180 $62,641 $1,117 $96,938 22.6% 42.7% 0.8% 66.0% nventory Carry $201 $363 $436 $0 $0 otal Variable ontribution $13,417$11,931 $10,545 $10,026 $4,014 $49.934 34.0% eriod Costs epreciation G&A: R&D Promotions Sales Admin $3,667 $3,800 $1,700$1,600 $2,357 $250 $1,050 $1,050 $1,050$1,050 1,050 $900 $279 $1,000 $0 $7,209 $6,672 $5,176 $5,606 $4,836 $1,000 $6,208 $5,259 $5,369 $4,420 (S822) ($1,000) $13,124 $4,200 $5,250 $5,300 $2,625 $30.499 8.9% 2.9% 3.6% 3.6% 1.8% 20.8% $1,000 $973 $977 $1,000 $1,000 $900$1,500 $553 $492 $822 $480 otal Period et Margin $19.435 13.2% efinitions: Sales: Unit sales times list price. Direct Labor: Labor costs incurred to produce the roduct that was sold. Inventory Carry Cost: the cost to carry unsold goods in inventory epreciation: Calculated on straight-line 15-year depreciation of plant value. R&D Costs: R&D epartment expenditures for each product. Admin: Administration overhead is estimated at 1.5% f sales. Promotions: The promotion budget for each product. Sales: The sales force budget for LongTerm Interest ach product. Other: Charges not included in other categories such as Fees, Write Offs, and QM. The fees include money paid to investment bankers and brokerage firms to issue new tocks or bonds plus consulting fees your instructor might assess. Write-offs include the loss you Net Profit ight experience when you sell capacity or liquidate inventory as the result of eliminating a roduction line. If the amount appears as a negative amount, then you actually made money on Other EBIT Short Term Interest $2,524 $16.911 $4,174 $10,467 $794 $30 $1,446 1.7% 11.5% 2.8% 7.1% 0.5% 0.0% 1.0% Taxes Profit Sharing Variable Margins 2008 Digby he liquidation of capacity or inventory. EBIT: Earnings Before Interest and Taxes. Short Term nterest: Interest expense based on last year's current debt, including short term debt, long term otes that have become due, and emergency loans. Long Term Interest: Interest paid on utstanding bonds. Taxes: Income tax based upon a 35% tax rate. Profit Sharing: Profits shared ith employees under the labor contract. Net Profit: EBIT minus interest, taxes, and profit harin 40.0% 300% 20.0% 10.0% 0.0% Cash Flows from Operating Activities: Net Income (Loss) Depreciation Extraordinary gains/losses/writeoffs Accounts Payable Inventory 2018 $1,446 $5,098 $13,124$9,887 $0 $722 ($635) ($2,238) ($2,023) ($276) 2019 $0 $1,409 Accounts Receivable Net cash from operations Cash Flows from Investing Activities: Plant Improvements Cash Flows from Financing Activities: Dividends Paid Sales of Common Stock Purchase of Common Stock Cash from long term debt Retirement of long term debt $13,321$13,192 ($51,960) ($40,900) $0 $0 ($11,300) $0 $16,584 $4,220 $0 $33,894 $17,785 $0 $12,460 ($3,801) Change in current debt (net) Net cash from financing activities Net change in cash position Closing cash position $51,637 $18,204 $12,998 ($9,504) $36,126$23,128 2019 Commorn Size 7 7% 59% 48% SSETS 2018 ash ccounts Receivable $36,126 $12,072 $9,311 $23,128 $10,049 $8,675 Inventory otal Current Assets $57,509 28.1% $41,852 $217,260 Accumulated Depreciation($70,300) 106.3% -34.4% $165,300 ($57,176) lant & Equipment otal Fixed Assets $146,960 71.9% $108,124 otal Assets $204,469 100.0% $149,976 IABILITIES & OWNERS QUITY ccounts Payable urrent Debt ong Term Debt $7,928 $34,217 $81,733 32% 16.7% 40.0% $6,519 $21,757 $59,140 otal Liabilities $123,878 60.6% $87,416 $35,132 $45,459 2% 222% $18,548 $44,013 ommon Stock Retained Earnings Total Equity Total Liab. &O. Equity $80,591 39.4% $62,561 $204,469 100.0% $149,976 MarketCap Book Value Close Change Company Andrews Baldwin Chester Shares EPS Dividend Yield $62.47 ($14.14)2,051, $79.88 $29.15 ($11.30) 2,978,341 $37.14 $42.60 $37.04 $25.71 $30.94 $13.33 1,885,142 $151 ($0.49) $0.00 $0.00 ($9.70)2,604,781 $97 Closing Stock Price Andrews Baldwin Chester S100 S0 2013 2014 2015 2016 2017 2018 2019 2020 2021 Bond Market Summar Company Series# Face Yield Close$ S&P Andrews 11.2S2024 11.9S2025 $8,837,000 $7,072,000 102.24 105.56 11.3% Baldwin 11.1S2026 11.2S2027 12.0S2028 12.1S2029 $2,425,572 $5,785,94:9 $1,278,536 $16,803,999 12.0% 92.86 92.73 96.37 12.5% Chester 11.3S2024 12.5S2025 12.5S2026 12.5S2027 13.4S2028 13.9S2029 $10,417,600 $14,665,611 $7,987,653 $9,474,381 $14,417,355 $34,603,544 90.41 13.3% 13.5% 14.0% 93.80 92.60 98.96 11.2S2024 12.4S2025 11.9S2027 13.0S2028 13.6S2029 $8,607,404 $5,756,951 $15,689,911 $17,785,485 $33,893,731 94.53 13.5% 13.7% 98.95 Selected Financial Statistics Digby 1.0% 0.72 07% 2.5 1.8% $0 $146,872,072 $16,911,040 $1,445,969 $6,544,032 11 .8% 34.0% Andrews 55% 1.22 67% Baldwin 93% 1.26 Chester -0.9% 0.73 .07% 2.9 ROS Asset Turnover ROA Leverage (Assets/Equity) ROE Emergency Loan Sales EBIT Profits Cumulative Profit SG&A/ Sales Contrib. Margin % 9,5% $0 $148,730,186 $15,702,752 $8,166,684 $16,294,292 11.4% 28.3% 2.0 22.9% $0 $171,884,475 $31,560,842 $16,021,462 $28,808,191 7.1% 34.2% $0 $160,247,733 $15,116,330 ($1,472,293) $5,014,974 8.5% 32.6% Percent of Sales $ Market Share 100% 90% 80% 70% 60% 50% 4% 30% 20% 1096 096 Profit Other OSGA Depr Var Costs Andrews 23.69% Baldwin 27.38 % Chester 25.53% Digby 23.4 % Andrews Baldwin Chester Digby COMP-XM INQUIRER Page 1