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It is January 2nd. Senior management of

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 2.45. Assume the stock can be issued at yesterday's stock price $12.77. Which of the following statements are true? (Select 2 answers)

 Digby bond issue will be $47,876

 Total investment for Digby will be $1,561,854

 Digby will issue stock totaling $638,297

 Long term debt will increase from $34,253,638 to $34,891,935

 Total Assets will rise to $131,267,730

 Digby working capital will be unchanged at $12,181,751



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29-07-22 | 13:59:45


Digby will issue stock totaling $638,297

Long term debt will increase from $34,253,638 to $34,891,935


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