Because of its inability to pay its debts, the KDC Manufacturing Company has been forced into bankruptcy as of June 30, 2021. The Statement of Financial Position on that date shows. Cash Accounts Receivable Notes Receivable Inventories Prepaid Expenses Land and Buildings Equipment ASSETS TOTAL c. 48% d. 50% 5,665 Accounts Payable 39,350 Notes Payable - BPI 18,500 Notes Payable - Suppliers 87,850 Accrued Wages 950 Accrued Taxes 61,250 Mortgage Bond Payable LIABILITIES and EQUITY 48,800 Common Stock - P100 par a. 4,355 b. 4,550 c. 3,120 d. 6,500 P262,365 TOTAL 15. The estimated loss on asset disposition is a. 29,240 b. 112,740 c. 111,790 d. 82,550 16. What is the estimated gain on asset disposition? a. 33,750 b. 41,000 c. 34,700 d. 0 17. The expected recovery percentage is: a. 67% b. 70% Retained Earnings 52,500 15,000 51,250 Additional Information: Only P16,110 of Accounts Receivable and P12,500 of Notes Receivable are expected to be collectible. The good notes are pledged to Bank of the Philippine Islands. • Inventories are expected to realize P45,100 when sold under insolvency. • Land and Buildings have an appraised value of P95,000. They serve as security on the bonds. • The current value of the equipment, net of disposal cost is P9,000. 1,850 4,650 90,000 75,000 (27,885) P262,365 18. Assuming the correct expected recovery percentage as computed above, how much is the amount expected to be paid for the accrued wages and accrued taxes?
Because of its inability to pay its debts, the KDC Manufacturing Company has been forced into bankruptcy as of June 30, 2021. The Statement of Financial Position on that date shows. Cash Accounts Receivable Notes Receivable Inventories Prepaid Expenses Land and Buildings Equipment ASSETS TOTAL c. 48% d. 50% 5,665 Accounts Payable 39,350 Notes Payable - BPI 18,500 Notes Payable - Suppliers 87,850 Accrued Wages 950 Accrued Taxes 61,250 Mortgage Bond Payable LIABILITIES and EQUITY 48,800 Common Stock - P100 par a. 4,355 b. 4,550 c. 3,120 d. 6,500 P262,365 TOTAL 15. The estimated loss on asset disposition is a. 29,240 b. 112,740 c. 111,790 d. 82,550 16. What is the estimated gain on asset disposition? a. 33,750 b. 41,000 c. 34,700 d. 0 17. The expected recovery percentage is: a. 67% b. 70% Retained Earnings 52,500 15,000 51,250 Additional Information: Only P16,110 of Accounts Receivable and P12,500 of Notes Receivable are expected to be collectible. The good notes are pledged to Bank of the Philippine Islands. • Inventories are expected to realize P45,100 when sold under insolvency. • Land and Buildings have an appraised value of P95,000. They serve as security on the bonds. • The current value of the equipment, net of disposal cost is P9,000. 1,850 4,650 90,000 75,000 (27,885) P262,365 18. Assuming the correct expected recovery percentage as computed above, how much is the amount expected to be paid for the accrued wages and accrued taxes?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
Question
Transcribed Image Text:Because of its inability to pay its debts, the KDC Manufacturing Company has been forced
into bankruptcy as of June 30, 2021. The Statement of Financial Position on that date
shows.
Cash
Accounts Receivable
Notes Receivable
Inventories
Prepaid Expenses
Land and Buildings
Equipment
ASSETS
TOTAL
c. 48%
d. 50%
5,665 Accounts Payable
39,350 Notes Payable - BPI
18,500 Notes Payable -
Suppliers
87,850 Accrued Wages
950 Accrued Taxes
61,250 Mortgage Bond
Payable
LIABILITIES and EQUITY
48,800 Common Stock -
P100 par
a. 4,355
b. 4,550
c. 3,120
d. 6,500
P262,365 TOTAL
15. The estimated loss on asset disposition is
a. 29,240
b. 112,740
c. 111,790
d. 82,550
16. What is the estimated gain on asset disposition?
a. 33,750
b. 41,000
c. 34,700
d. 0
17. The expected recovery percentage is:
a. 67%
b. 70%
Retained Earnings
52,500
15,000
51,250
Additional Information:
Only P16,110 of Accounts Receivable and P12,500 of Notes Receivable are expected
to be collectible. The good notes are pledged to Bank of the Philippine Islands.
• Inventories are expected to realize P45,100 when sold under insolvency.
•
Land and Buildings have an appraised value of P95,000. They serve as security on
the bonds.
•
The current value of the equipment, net of disposal cost is P9,000.
1,850
4,650
90,000
75,000
(27,885)
P262,365
18. Assuming the correct expected recovery percentage as computed above, how much
is the amount expected to be paid for the accrued wages and accrued taxes?
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