Glo's Glasses Balance Sheet Lists Net Fixed Assets as $20

question 119

Multiple Choice

Glo's Glasses balance sheet lists net fixed assets as $20 million. The fixed assets could currently be sold for $25 million. Glo's current balance sheet shows current liabilities of $7 million and net working capital of $3 million. If all the current accounts were liquidated today, the company would receive $9 million cash after paying $7 million in liabilities. What is the book value of Glo's assets today? What is the market value of these assets?

• A) $10 million, $16 million
• B) $10 million, $35 million
• C) $30 million, $35 million
• D) $30 million, $41 million

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Definitions:

Debts

Money owed by one party, the debtor, to another, the creditor; an obligation to pay or render something of value.

Partnership

A business arrangement in which two or more individuals share ownership and the operational responsibilities of the business.

Uniform Limited Liability Company Act

A comprehensive statute that provides a uniform regulatory framework for the formation, operation, and dissolution of limited liability companies (LLCs) in the states that adopt it.

Dissolve

To formally bring to an end a legal entity or agreement, such as a business corporation or a marriage.