Assets and Market Value Klingon Cruisers, Inc. purchased new cloaking machinery three years ago for $9.5 million.

Question:

Assets and Market Value Klingon Cruisers, Inc. purchased new cloaking machinery three years ago for $9.5 million. The machinery can be sold to the Romulans today for $6.3 million. Klingon’s current balance sheet shows net fixed assets of $5 million current liabilities of $2.1 million and net working capital of $800,000. If all the current assets were liquidated today, the company would receive $2.8 million cash.

1. What is the book value of Klingon’s assets today?

2. Market value?

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...