Fundamentals of Corporate Finance Ch 1 and 2

Topics: Generally Accepted Accounting Principles, Balance sheet, Financial ratios Pages: 4 (716 words) Published: May 19, 2013
Page 43-44, Chapter 2
5.Klingon Widgets, Inc.Notes
Current Assetspurch cloaking 3 yrs ago for $6mil (book value)
+Net Working Capital$215,000can sell today for 5.3m (market value)
+Current Liability$900,000net fixed assets 3.2m
=Current Assets$1,115,000current liabilities 900,000
net working capital of 215,000
Book Value of Total Assetsif liquidated all assets today = 1.25m = market value
+Book Value of Current Assets$1,115,000what is book value of total assets today?
+Book Value of Net Fixed Assets$6,000,000**Assumimg that the cloaking equip is the only asset- that bothered me- I would like a schedule.**What is market value of total assets today?
=Book Value of Total Assets$7,115,000

Book Valye of Klingon's total assets today: $7,115,000

Market Valye of Total Assets
+Market Value of Current Assets$1,250,000
+Market Value of Net Fixed Assets$5,300,000
=Market Value of Total Assets$6,550,000

Market Value of Klingon's total assets today: $6,550,000

16.Cornell Corp.
Balance Sheet
AssetsLiabilities and Owner's Equity
Current AssetsCurrent Liabilities
Cash$127,000Accounts Payable$210,000
Accounts Receivable$105,000Notes Payable$160,000
Fixed AssetsLong Term Debt$845,000
Net Fixed Assets$1,620,000
Intangible Fixed Assets (Patents, Copyrights)Owner's Equity
$630,000Owner's Equity $282,000
Total$2,250,000Retained Earnings$1,278,000

Total Assets$2,775,000Total Liabilities and Owner's Equity$2,775,000

19.Raines Umbrella Corp. 2010...
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