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It is January 2nd. Senior management of Digby meets to determine their investment plan for the year. They decide to fully fund a plant and
It is January 2nd. 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 50,000 shares of stock plus a new bond issue. The CFO happily notes this will raise their Leverage (=assets/equity) to a new target of 2.7. Assume the stock can be issued at yesterday's stock price ($35.08). Which of the following statements are true? Check all that apply. Select: 3 Save Answer OOOC Long term debt will increase from $81,418,599 to $83,172,599 Total investment for Digby will be $4,735,800 The Digby Working Capital will be unchanged at $15,664 Total Assets will rise to $220,210,000 The Digby bond issue will be $2,981,800 Digby will issue stock totaling $1,754,000
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