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Calculate the net asset values from the following information. Round your answers to the nearest cent.

[tex]\[
\begin{tabular}{|c|c|c|c|c|c|c|}
\hline
& Market Value of Investment & Current Liabilities & Number of Shares Outstanding & NAV \\
\hline
a. & \$5,650,000 & \$820,000 & 500,000 & \\
\hline
b. & \$13,860,000 & \$830,000 & 890,000 & \\
\hline
\end{tabular}
\][/tex]



Answer :

GinnyAnswer
To calculate the net asset values (NAV) for investments "a" and "b," follow these steps:

### Step 1: Understand the Formula
The formula for calculating the Net Asset Value (NAV) per share:
[tex]\[ \text{NAV} = \frac{\text{Market Value of Investments} - \text{Liabilities}}{\text{Number of Shares Outstanding}} \][/tex]

### Step 2: Input the Given Data
For investment "a":
- Market Value of Investments = [tex]$5,650,000 - Liabilities = $[/tex]820,000
- Number of Shares Outstanding = 500,000

For investment "b":
- Market Value of Investments = [tex]$13,860,000 - Liabilities = $[/tex]830,000
- Number of Shares Outstanding = 890,000

### Step 3: Calculate NAV for Investment "a"
1. Subtract the liabilities from the market value of investments:
[tex]\[ 5,650,000 - 820,000 = 4,830,000 \][/tex]

2. Divide the result by the number of shares outstanding:
[tex]\[ \frac{4,830,000}{500,000} = 9.66 \][/tex]

So, the NAV for investment "a" is [tex]$9.66 per share. ### Step 4: Calculate NAV for Investment "b" 1. Subtract the liabilities from the market value of investments: \[ 13,860,000 - 830,000 = 13,030,000 \] 2. Divide the result by the number of shares outstanding: \[ \frac{13,030,000}{890,000} = 14.64 \] So, the NAV for investment "b" is $[/tex]14.64 per share.

### Summary of Results
- The net asset value (NAV) for investment "a" is [tex]$9.66 per share. - The net asset value (NAV) for investment "b" is $[/tex]14.64 per share.

These results are rounded to the nearest cent as specified.

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