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Volkswagen is considering expansion of its manufacturing facility in Chattanooga Tennessee (USA). The current Balance Sheet and Income Statement for Volkswagen is provided. For each
Volkswagen is considering expansion of its manufacturing facility in Chattanooga Tennessee (USA). The current Balance Sheet and Income Statement for Volkswagen is provided. For each statement, identify which components will be impacted and qualitatively how once the project is complete. You do not need to provide new numbers. You should assume that the expansion will be profitable, the earnings will be retained by the company, and will be financed through additional debt.
Financial Statements - Volkswagen Chattanooga TN USA Facility (hypothetical) Balance Sheet [in millions] Accats: Current assets: Inventory $ 40 Other current assets Total current aseats $100 Long term assets: Equipment $200 less Accumulated depreciation $ 5O Net aquipment assets $190 Other long-term assets $3oo Total long-term assets 5490 Total Assets 9550 Liabilities and Equity. Currant liabilities: Accrued Liabilities $ 25 Other current liabilities $ 30 Total currant liabilities Debt $145 Stockholders equity 5390 Total liabilities and equity SS50 Income Statement (in millions) Sales Cost of goods sold $400 Gross profit $400 Operating expenses $250 Operating profit $150 Interest expense $ 5O Pretax profit $100 Taxes $ 30 Net income $ 70Step by Step Solution
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