Question
Company A has asked you to perform an Adjusted Net Assets Method in order to calculate the fair value of its equity. Assume the following
Company A has asked you to perform an Adjusted Net Assets Method in order to calculate the fair value of its equity. Assume the following balance sheet, and the list of adjustments that you have estimated as being appropriate. What is the fair value of the equity (in $0) of Company A, after applying the adjustments?
| Company A Balance Sheet: | |
| Assets | $0 |
| Cash | 2,000 |
| A/R | 2,000 |
| Inventory | 4,000 |
| PP&E | 15,000 |
| Intangibles | 10,000 |
| Goodwill | 5,000 |
| Total | 38,000 |
| Liabilities | $0 |
| Payables | 1,000 |
| Accruals | 2,000 |
| Note Payable | 2,000 |
| Bonds Payable | 8,000 |
| SH Equity | 25,000 |
| Total | 38,000 |
| Assume the following adjustments: | |
| Inventory | 400 |
| PP&E | 5,000 |
| Goodwill | -5,000 |
| Bonds Payable | -1,000 |
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Cost And Management Accounting An Introduction
Authors: Colin Drury
7th Edition
1408032139, 978-1408032138
