It is January 2nd. Senior management of Baldwin 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 ($32.76). Which of the following statements are true? Check all that apply.
A. The Baldwin bond issue will be $2,784,600
B. Long term debt will increase from $80,962,041 to $82,600,041
C. Total Assets will rise to $220,750,000
D. Baldwin will issue stock totaling $1,638,000
E. Total investment for Baldwin will be $4,422,600
F. The Baldwin Working Capital will be unchanged at $16,465
The solution explains the correct alternatives relating to the investment plan