Question

In: Finance

What is the tangible net worth of Widgets, Inc. if it has the following balance sheet...

What is the tangible net worth of Widgets, Inc. if it has the following balance sheet totals at December 31, 20X3: total current assets of $30,000; total fixed assets of $65,000; goodwill and patents of $5,000; and total liabilities of $45,000? 20X3

Select one:

a. $25,000

b. $50,000

c. $55,000

d. $100,000

Solutions

Expert Solution

What is the tangible net worth of Widgets, Inc.

Answer: $50,000

Workings

Formula for calculating tangible net worth is as follows;

Tangible net worth         = Total Assets – total liabilities – Intangible assets

Total Assets        = total current assets + total fixed assets + Intangible assets

                                =$30,000 + $65,000 + $5000

                                =$100,000

Calculation of tangible net worth

Tangible net worth         = Total Assets – total liabilities – Intangible assets

                                                = $100,000 - $45,000 - $5000

                                                = $50,000

Note:

Information provided in the question

Total current assets = $30,000

Total fixed assets = $65,000

Intangible assets = Goodwill and patents = $5,000

Total liabilities = $45,000


Related Solutions

The debt/tangible net worth ratio: is the same as the debt ratio. has the same objectives...
The debt/tangible net worth ratio: is the same as the debt ratio. has the same objectives as the debt/equity ratio. includes both liabilities and shareholders' equity in the denominator. is a uniform computation across different companies.
Lloyd Inc. has sales of $400,000, a net income of $28,000, and the following balance sheet:...
Lloyd Inc. has sales of $400,000, a net income of $28,000, and the following balance sheet: Cash $103,680 Accounts payable $117,720 Receivables 204,120 Notes payable to bank 44,280 Inventories 550,800 Total current liabilities $162,000 Total current assets $858,600 Long-term debt 205,200 Net fixed assets 221,400 Common equity 712,800 Total assets $1,080,000 Total liabilities and equity $1,080,000 The new owner thinks that inventories are excessive and can be lowered to the point where the current ratio is equal to the industry...
Lloyd Inc. has sales of $150,000, a net income of $13,500, andthe following balance sheet:...
Lloyd Inc. has sales of $150,000, a net income of $13,500, and the following balance sheet: Cash $36,660 Accounts payable $34,320 Receivables 75,270 Notes payable to bank 16,380 Inventories 218,400 Total current liabilities $50,700 Total current assets $330,330 Long-term debt 50,700 Net fixed assets 59,670 Common equity 288,600 Total assets $390,000 Total liabilities and equity $390,000 The new owner thinks that inventories are excessive and can be lowered to the point where the current ratio is equal to the industry...
. The Balance sheet reveals the firm's assets, liabilities and owners' equity (net worth). But the...
. The Balance sheet reveals the firm's assets, liabilities and owners' equity (net worth). But the cash position of the company also forms a very prominent position in order to know the liquidity of the company. The balance sheet items (in OMR) are taken from Magrib Ltd. for the years 2018 and 2019 respectively: 2018 2019 Assets Furniture, Equipment and buildings       100,060                   81,040 Current Assets Inventory         29,300                   14,480 Sundry debtors         12,750                   15,870 Bank        ...
Given the following financial data, complete the balance sheet below: Total debt to net worth 1...
Given the following financial data, complete the balance sheet below: Total debt to net worth 1 to 1 Quick ratio 1.5 to 1 Asset turnover 1.5 times Average collection period 48.67 days sales/inventory 7.5times Cash ___________ Receivables ___________ Inventories __________ Net plant ______________ Total assets _____ Notes Payable _________ Long term debt $30,000 Common stock 20,000 Retained earnings 30,000 Total debt & equity
Given the following financial data, complete the balance sheet below: Total debt to net worth 1...
Given the following financial data, complete the balance sheet below: Total debt to net worth 1 to 1 Quick ratio 1.5 to 1 Asset turnover 1.5 times Average collection period 48.67 days sales/inventory 7.5times Cash ___________ Receivables ___________ Inventories __________ Net plant ______________ Total assets _____ Notes Payable _________ Long term debt $20,000 Common stock 15,000 Retained earnings 25,000 Total debt & equity
A company has the following balance sheet. What is its net operating working capital? Cash $...
A company has the following balance sheet. What is its net operating working capital? Cash $ 10 Accounts payable $ 20 Short-term investments 20 Accruals 30 Accounts receivable 30 Notes payable 20 Inventory 40 Current liabilities 70 Current assets 100 Long-term debt 30 Net fixed assets 80 Common equity 10 Retained earnings 70 Total assets $180 Total liab. & equity $180
BBP, Inc., with sales of $600,000, has the following balance sheet: BBP, Incorporated Balance Sheet as...
BBP, Inc., with sales of $600,000, has the following balance sheet: BBP, Incorporated Balance Sheet as of 12/31/X0 Assets Liabilities and Equity Cash $ 30,000 Accounts payable $ 24,000 Accounts receivable 60,000 Accruals 42,000 Inventory 84,000 Notes payable 70,000 Current assets 174,000 Current liabilities 136,000 Fixed assets 215,000 Common stock 70,000 Retained earnings 183,000 Total assets $ 389,000 Total liabilities and equity $ 389,000 The firm earns 13 percent on sales and distributes 25 percent of its earnings. Using the...
Scare Train, Inc. has the following balance sheet statement items: current liabilities of $847,569; net fixed...
Scare Train, Inc. has the following balance sheet statement items: current liabilities of $847,569; net fixed and other assets of $1,542,574; total assets of $3,360,467; and long-term debt of $704,043. What is the amount of the firm’s net working capital?
The following is the balance sheet for 20X5 for Marbell Inc. Marbell Inc. Balance Sheet as...
The following is the balance sheet for 20X5 for Marbell Inc. Marbell Inc. Balance Sheet as at December 31, 20X5 Marbell Inc. Balance Sheet as at December 31, 20X5 Assets Liabilities Cash $15,500 Accounts Payable $ 90,000 Accts. Rec 90,000 Notes Payable (non-spontaneous) 30,000 Inventory 60,000 Accrued Expenses 7,500 Current Assets 165,000 Current Liabilities 127,500 Fixed assets (non-spontaneous) 60,000 Common stock 75,500 Retained earnings 22,500 Total Assets $225,000 Total Liabilities + S.H Equity $225,000 Sales for 20X5 were $300,000. Sales...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT