1. **State the problem:** We need to find the book value and market value of Klingon Widgets, Inc.'s total assets today given various financial data. 2. **Given data:** - Original machinery cost: $8,000,000 - Machinery market value today: $6,700,000 - Net fixed assets on balance sheet: $3,100,000 - Current liabilities: $790,000 - Net working capital (NWC): $145,000 - Cash from liquidating current assets: $865,000 3. **Recall definitions:** - Book value of total assets = Net fixed assets + Current assets - Net working capital = Current assets - Current liabilities - Market value of total assets = Market value of fixed assets + Market value of current assets 4. **Calculate current assets:** From NWC formula: $$\text{NWC} = \text{Current Assets} - \text{Current Liabilities}$$ Rearranged: $$\text{Current Assets} = \text{NWC} + \text{Current Liabilities} = 145,000 + 790,000 = 935,000$$ 5. **Calculate book value of total assets:** $$\text{Book Value} = \text{Net Fixed Assets} + \text{Current Assets} = 3,100,000 + 935,000 = 4,035,000$$ 6. **Calculate market value of current assets:** Given liquidated cash from current assets is $865,000, so market value of current assets = $865,000 7. **Calculate market value of total assets:** $$\text{Market Value} = \text{Market Value of Fixed Assets} + \text{Market Value of Current Assets} = 6,700,000 + 865,000 = 7,565,000$$ **Final answers:** - Book value of total assets today is $4,035,000 - Market value of total assets today is $7,565,000