Ataway Company has suffered severe financial difficulties and is considering filing a bankruptcy petition. It has the following assetsand liabilities. The assets are stated at net realizable value.Assets (pledged against debts of $78,000)Assets (pledged against debts of $146,000)Other assetsLiabilities with priorityOther unsecured creditors$ 132,00058,00088,00053,200208,000In a liquidation, how much money would be paid on the partially secured debt?Payment on partially secured debt$ 82,667

Step 1:Computation of amount to be paid to partially secured debt as follows :…

Answered: Ataway Company has suffered severe…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

S Olds Company declares Chapter 7 bankruptcy. The following are the book values of the asset and liability accounts at that time. A bankruptcy expert estimates that administrative expense will total $31,000. Cash Accounts receivable Inventory Land (secures note A) Building (secures bonds) Equipment Accounts payable Taxes payable to government Note payable A Note payable B Bonds payable $ 43,000 79,000 89,000 Amount to be received 219,000 (valued at $47,000) (valued at $75,000) (valued at $179,000) 419,000 (valued at $358,000) 139,000 (value unknown) 199,000 39,000 208,000 269,000 319,000 The holders of note payable B want to collect at least $134,500. To achieve this goal, how much does the company have to receive in the liquidation of its equipment? $ 238,500
Consider the following potential events that might have occurred to Global on December 30, 2019. For each one, indicate which line items in Global's balance sheet would be affected and by how much. Also indicate the change to Global's book value of equity. a. Global used $19.2 million of its available cash to repay $19.2 million of its long-term debt. b. A warehouse fire destroyed $4.7 million worth of uninsured inventory. c. Global used $4.9 million in cash and $5.4 million in new long-term debt to purchase a $10.3 million building. d. A large customer owing $3.1 million for products it already received declared bankruptcy, leaving no possibility that Global would ever receive payment. e. Global's engineers discover a new manufacturing process that will cut the cost of its flagship product by more than 51%. f. A key competitor announces a radical new pricing policy that will drastically undercut Global's prices. c. Global used $4.9 million in cash and $5.4 million in new long-term…
Your Question : Please introduction and correct and incorrect option explain!
Fast answer please
compute the estimated deficiency compute the expected recovery percentage of unsecured creditors compute the amount of estimated loss on assets realization
APA and Co., Inc. purchased a Cadillac automobile with little cash down and signed a note, secured by the Cadillac, for 48 easy monthly payments. When the company files for bankruptcy, the balance due on the Cadillac amount to P6,000,000. The car has a book value of P8,000,000 and a net realizable value of P4,000,000. The unsecured creditors of APA and Co. can expect to receive 50 percent of their claims. In the liquidation, the bank that holds the note on the Cadillac should receive:
Dengar
Xavier Company is going through a Chapter 7 bankruptcy. All assets have been liquidated, and the company retains only $27,200 in free cash. The following debts, totaling $48,050, remain: Government claims to unpaid taxes $ 8,000 Salary during last month owed to Mr. Key (not an officer) 19,825 Administrative expenses 4,450 Salary during last month owed to Ms. Rankin (not an officer) 7,225 Unsecured accounts payable 8,550 Indicate how much money will be paid to the creditor associated with each debt.
Nissan Corporation is undergoing liquidation. On January 1, 2020 its Statement of Financial Position showed the following accounts: ASSETS Cash P 150,000 Accounts Receivables-net 290,600 Inventory 50,000 Prepaid Expenses 10,400 Building 380,000 Goodwill 80,000 TOTAL P 961.000 LIABILITIES AND EQUITY Salaries Payable P 85,000 Accounts Payable 120,700 Mortgages Payable 428,000 Loan Payable 130,000 Notes Payable 84,300 Ordinary Shares 170,000 Deficit (57,000) TOTAL P961.000 The mortgage payable is secured by the Building having a realizable value of P400,000. Accounts Payable amounting to P75,000 is secured by receivables amounting to P90,600 (P9,900 of which is uncollectible). The balance of receivables which has a realizable value of P187,500 is used to secure the loan payable. Inventory has a realizable value of P41,200. In addition to recorded liabilities are: accrued interest on mortgage payable amounting to P4,280,…
Shi Company is going through a Chapter 7 bankruptcy. All assets have been liquidated, and the company retains only $26,600 in free cash. The following debts, totaling $45,050, remain: Government claims to unpaid taxes Salary during last month owed to Mr. Key (not an officer) Administrative expenses Salary during last month owed to Ms. Rankin (not an officer) Unsecured accounts payable $ 7,400 19,225 3,850 Indicate how much money will be paid to the creditor associated with each debt. Types of Debts Administrative expenses Salary during last month owed to Mr. Key and Ms. Rankin 6,625 7,950 Answer is complete but not entirely correct. Amounts 3,850 $12.850 $ 3,716 $26,600 Government claims to unpaid taxes
The COCO Manufacturing Company has been forced into bankruptcy as of April 30, 2022. The statement of financial position on that date shows: ASSETS:Cash P 2,700Accounts Receivable 39,350Notes Receivable 18,500 Inventories 87,850Prepaid Expenses 950 Land and Buildings 61,250Equipment 48,800 Retained Earnings (30,850)Total ? LIABILITIES AND EQUITY: Accounts Payable P52,500 Notes Payable - PNB 15,000 Notes Payable - Suppliers 51,250 Accrued Wages 1,850 Accrued Taxes 4,650 Mortgage Bonds Payable 90,000 Common Stock - P 100 par 75,000 Total ? Additional Information:▪Accounts Receivable of P 16,110 and Noted Receivable of P 12,500 are expected to be…
The Walston Company is to be liquidated. It has the following liabilities: Income taxes Notes payable (secured by land) Accounts payable Salaries payable (evenly divided between two employees) Bonds payable Administrative expenses for liquidation The company has the following assets: $ 7,600 136,000 93,000 14,000 78,000 28,000 Book Value Fair Value Current assets $ 88,000 Land 108,000 Buildings and equipment 108,000 $ 43,000 98,000 132,000 Required: How much money will the holders of the notes payable collect following liquidation? Total amount collected

SEE MORE QUESTIONS

Recommended textbooks for you

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis…

Accounting

ISBN:

9780134475585

Author:

Srikant M. Datar, Madhav V. Rajan

Publisher:

PEARSON

Intermediate Accounting

Accounting

ISBN:

9781259722660

Author:

J. David Spiceland, Mark W. Nelson, Wayne M Thomas

Publisher:

McGraw-Hill Education

Financial and Managerial Accounting

Accounting

ISBN:

9781259726705

Author:

John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS