(Q3) Joes Tree Service bought new machines 3 years ago for $600,000. The machines can be sold today to his brothers company Sams Tree Service for $430,000.

Joes current statement of financial position show net fixed assets of $380,000, current liabilities of $720,000, and net working capital of $250,000.

If all Joes assets were liquidated today, he would receive $1M.

(A) What is the book value of Joes company?

(B) What is the market value of Joes company?

(C) Explain the difference between book and market value.

(D) Why is it important to know these the book and market values of an asset?

(E) What is the implication of depreciation on book and market values?

(F) How do non-cash expenses impact a companys profitability?

Answer Place only your final answer in the box.

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Show your work below (you must show all calculations used to derive you answers):