Assume that a business's balance sheet reports total assets of$500,000 and total liabilities of $300,000. Now assume that $20,000 ofnet fixed assets (net plant and equipment) are written off due totechnological obsolescence. All else the same, what is the total equityof the business after the write-off?a. $200,000b. $190,000c. $180,000d. $170,000e. There is insufficient information given to answer this question.

To determine the total equity after the write-off, we need to adjust the accounting equation:…

Answered: Assume that a business's balance sheet…

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter7: Analysis Of Financial Statements

Section: Chapter Questions

Problem 7P: Ace Industries has current assets equal to 3 million. The companys current ratio is 1.5, and its...

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Suppose a firm has the following information: Operatingcurrent assets = $2.7 million; operating current liabilities =$1.5 million; long-term bonds = $3 million; net plant andequipment = $7.8 million; and other long-term operating assets =$1 million. How much is tied up in net operating workingcapital (NOWC)? ($1.2 million) How much is tied up in total netoperating capital? ($10 million)
Question: A companys total liabilities are $247,000, and its equity is $987,000. What are the total assets? Want solution ASAP to this financial accounting question
You are the new CFO of Risk Surfing Ltd, which has current assets of $ 7 920, net fixed assets of $17 700, current liabilities of $4 580 and long term debts of $5 890. Required:a.Calculate owners’ equity and build a balance sheet for the company? b.How much is net working capital of the company? c.Calculate the return on assets of the company given that Return on Equity is 30%? d.What is the PE of the company if total number of ordinary sharesoutstanding is 2000 and market price of each share is $12?
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If a company has total liabilities accounting questions
Ace Industries has current assets equal to 3 million. The companys current ratio is 1.5, and its quick ratio is 1.0. What is the firms level of current liabilities? What is the firms level of inventories?
You are considering two possible companies for investment purposes. The following data is available for each company. Additional Information: Company A: Bad debt estimation percentage using the income statement method is 6%, and the balance sheet method is 10%. The $230,000 in Other Expenses includes all company expenses except Bad Debt Expense. Company B: Bad debt estimation percentage using the income statement method is 6.5%, and the balance sheet method is 8%. The $140,000 in Other Expenses includes all company expenses except Bad Debt Expense. A. Compute the number of days sales in receivables ratio for each company for 2019 and interpret the results (round answers to nearest whole number). B. If Company A changed from the income statement method to the balance sheet method for recognizing bad debt estimation, how would that change net income in 2019? Explain (show calculations). C. If Company B changed from the balance sheet method to the income statement method for recognizing bad debt estimation, how would that change net income in 2019? Explain (show calculations). D. What benefits do each company gain by changing their method of bad debt estimation? E. Which company would you invest in and why? Provide supporting details.
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4. Technology Systems has the following balance sheet. Assume that all current assets are used in operations. How much net operating working capital does the firm have? Also, how important is net operation working capital to a company? Cash Accounts receivable Inventory Current assets Net fixed assets Total assets $ 100 650 550 Accounts payable Accruals Notes payable Current liabilities Long-term debt Common equity Retained earnings $2,300 Total liab. & equity $ 1,300 $1,000 $ 200 110 590 $ 900 600 300 500 $2,300

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