Problem 2.18 Mathet Value versus Book Value (LG2-2) Ava\'s SpiriBell Corp. lists

Question

Problem 2.18 Mathet Value versus Book Value (LG2-2) Ava's SpiriBell Corp. lists fixed assets of $32 milion on its balanc, sheet. The firms fixed assets have recently been appraised at $56 million. Aves SpinBall Corp.s balanc, sheet also hsts current assets at $25 million. Cwr.rd assets wire appased at $46 million. Current kabildies? book and market value; stand at $7 million and the from?s book and rnarlet values of long.term were $28 million. Caculate the book and market velues of the firm?s stockholders? equity. Construct the book value end market value blance sheets for Ave?s SpiriBell Corp.

Explanation / Answer

Note: Sahreholers's equity = Total assets - current liability - stockholder's equity

BOOK VALUE MARKET VALUE Assets Current Assets 25 46 Fixed Assets 32 56 Total 57 102 Liabilities and equity Current Liability 7 7 Long-term Debt 28 28 Stock Holders Equity 22 67 Total 57 102

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