A company entering liquidation has reported assets with a book value of $900,000 and a liquidation value of $650,000. It also has previously unreported customer lists with a fair value of $50,000. Estimated liquidation costs are $40,000. The company's statement of net assets in liquidation reports total assets of:

Question

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The total assets in liquidation are calculated by adding the liquidation value of the reported assets ($650,000) and the fair value of the unreported customer lists ($50,000), resulting in $700,000. Liquidation costs are not deducted from total assets but are considered separately.

A Company Entering Liquidation Has Reported Assets with a Book