Question

Balsco's balance sheet shows total assets of $238,000 and total liabilities of $107,000. 11) The firm has 55,000 shares of stock outstanding that sell for $11 a share. What is amount of market value added?

A) $474,000
B) $389,000
C) $1,073,000
D) $123,712

Answer 1

Answer:

A) $474,000

Explanation:

Since Balsco's balance sheet shows total assets of $238,000 and total liabilities of $107,000, it means that equity should be $131,000.

The current price of Balsco's stock is $11 per share and total shares outstanding are 55,000, which results in a total market value of $605,000. If you subtract total equity from the total market value = $605,000 - $131,000 = $474,000