Acme Bricks Balance Sheet Lists Net Fixed Assets as $40

question 49

Multiple Choice

Acme Bricks balance sheet lists net fixed assets as $40 million. The fixed assets could currently be sold for $50 million. Acme's current balance sheet shows current liabilities of $15 million and net working capital of $12 million. If all the current accounts were liquidated today, the company would receive $77 million cash after paying $15 million in liabilities. What is the book value of Acme's assets today? What is the market value of these assets?

• A) $12 million, $77 million
• B) $27 million, $92 million
• C) $40 million, $50 million
• D) $67 million, $142 million

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Definitions:

Normal Balance

The side of an account (debit or credit) where increases are recorded, depending on the account type (asset, liability, equity, revenue, expense).

Temporary/Permanent

In accounting, this distinction categorizes accounts based on their persistence; temporary accounts reset each cycle, while permanent accounts carry their end balance into the next period.

Accrued Interest

Interest that has been incurred but not yet paid, often associated with bonds and loans.

Note Payable

A financial liability representing a written promissory note to pay a specific sum of money to another entity on a specific future date or on demand.