Reference no: EM13937146
It is January 2nd. Senior management of Chester 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 2.8. Assume the stock can be issued at yesterday’s stock price ($34.67). Which of the following statements are true? Check all that apply.
Select: 3
-Long term debt will increase from $84,365,920 to $86,099,420
-Total investment for Chester will be $4,853,800
-The Chester Working Capital will be unchanged at $12,734
-Total Assets will rise to $228,580,000
-The Chester bond issue will be $3,120,300
-Chester will issue stock totaling $1,733,500
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