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Muffin’s Masonry, Inc.’s, balance sheet lists net fixed assets as $33.00 million. The fixed assets could...

Muffin’s Masonry, Inc.’s, balance sheet lists net fixed assets as $33.00 million. The fixed assets could currently be sold for $57.00 million. Muffin’s current balance sheet shows current liabilities of $15.00 million and net working capital of $14.00 million. If all the current accounts were liquidated today, the company would receive $8.20 million cash after paying the $15.00 million in current liabilities.

  

What is the book value of Muffin’s Masonry’s assets today and the market value of these assets? (Enter your answers in millions of dollars rounded to 2 decimal places.)

  

BOOK VALUE MARKET VALUE
  Current assets $  m $  m  
  Fixed assets m m  
  Total $  m $  m  

Solutions

Expert Solution

Book value Market value
Net fixed asset 33 57
Current liability
as per balance sheet 15
Net working capital 14
Working capital = Current Asset - Current liabilities
14= Current Assets - 15
Current Assets= 29
Sale price of current assets= 8.20+15
Sale price of current assets=                                                     23.20
Book value Market value
Fixed Assets                                                     33.00              57.00
Current Assets                                                     29.00              23.20
Total                                                     62.00              80.20

jeff jeffy answered 1 year ago
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