E120 Principles of Engineering Economics
Problem Set #1
Penguin Pucks, Inc., has current assets of $5,100, next fixed assets of $23,800,
current liabilities of $4,300, and long-term debt of $7,400. What is the value of
the shareholders’ equity account for this firm? How much is net working capital?
Papa Roach Exterminators, Inc., has sales of $586,000, costs of $247,000,
depreciation expense of $43,000, interest expense of $32,000, and a tax rate of
35 percent. What is the net income for this firm?
Klingon Widgets, Inc., purchased new cloaking machinery three years ago for $7
million. The machinery can be sold to the Romulans today for $4.9 million.
Klingon’s current balance sheet shows net fixed assets of $3.7 million, current
liabilities of $1.1 million, and net working capital of $380,000. If all the current
assets were liquidated today, the company would receive $1.6 million cash. What