ENRON Company filed a voluntary bankruptcy petition on July 1, 2011 and the statement of affairs reflects thefollowing amounts:BOOKESTIMATEDCARRYINGCURRENTVALUEP185, 00060, 000160. 000P 405. 000VALUEAssets pledge with fully secure creditorsAssets pledge with partially secured creditorsFree AssetsP150, 00090, 000Liability with priorityFully secured creditorsPartially secured creditorsUnsecured creditors210, 000P 450. 000LiabilitiesP35, 000130, 00090, 000270, 000P 525, 0003. Determine the amount to be received by partially secured creditors.В. Р78, 000A.P90, 000C. P60, 000D. P72, 000

Liquidation is a state which happens within entity due to continuous losses of the entity, entity’s…

ENRON Company filed a voluntary bankruptcy petition on July 1, 2011 and the statement of affairs reflects the following amounts: BOOK CARRYING VALUE P150, 000 90, 000 210, 000 P 450. 000 Liabilities P35, 000 130, 000 90, 000 270, 000 P 525. 000 ESTIMATED CURRENT VALUE P185, 000 60, 000 160. 000 P 405. 000 Assets pledge with fully secure creditors Assets pledge with partially secured creditors Free Assets Liability with priority Fully secured creditors Partially secured creditors Unsecured creditors 3. Determine the amount to be received by partially secured creditors. B. P76, 000 с. РО, 000 A. P90, 000 D. P72, 000

ENRON Company filed a voluntary bankruptcy petition on July 1, 2011 and the statement of affairs reflects the following amounts: BOOK CARRYING VALUE P150, 000 90, 000 210, 000 P 450. 000 Liabilities P35, 000 130, 000 90, 000 270, 000 P 525. 000 ESTIMATED CURRENT VALUE P185, 000 60, 000 160. 000 P 405. 000 Assets pledge with fully secure creditors Assets pledge with partially secured creditors Free Assets Liability with priority Fully secured creditors Partially secured creditors Unsecured creditors 3. Determine the amount to be received by partially secured creditors. B. P76, 000 с. РО, 000 A. P90, 000 D. P72, 000

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

Use the following information to answer Question 21 and 22. Harrison Company has a loan receivable with a carrying value of $15,000 at December 31, 2019. On January 3, 2020, the borrower, Thomas Clark Imports, declares bankruptcy, and Harrison estimates that it will collect only 60% of the loan balance. 21) Which of the following entries would Harrison make to record the impairment under IFRS? a) Loan Receivable 9,000 Impairment Loss 9,000 b) Loan Recovery Expense 6,000 Loan Receivable 6,000 c) Impairment Loss 9,000 Loan Receivable 9,000 d) Bad Debt Expense 6,000 Provision for Doubtful Accounts 6,000 22) Assume that on January 5, 2021, Harrison learns that Thomas Clark Imports has emerged from bankruptcy. As a result, Harrison now estimates that all…
The Larisa Company is exiting bankruptcy reorganization with the following accounts: The company’s assets have a $760,000 reorganization value. As part of the reorganization, the company’s owners transferred 80 percent of the outstanding stock to the creditors. Prepare the journal entry that is necessary to adjust the company’s records to fresh start accounting.
Lucio Incorporated is undergoing liquidation. The statement of affairs shows unsecured claims without priority of 5,900,000; partially secured liabilities of 3,900,000; unsecured claims with priority of 365,000, and net free assets of 3,719,000. If unsecured claims wiyhout priority received 55% of their claims, how much will the partially secured liabilities receive?
Rothschild Chair Company, Incorporated, was indebted to First Lincoln Bank under a $40 million, 10% unsecured note. The note was signed January 1, 2014, and was due December 31, 2027. Annual interest was last paid on December 31, 2022. At January 1, 2024, Rothschild Chair Company was experiencing severe financial difficulties and negotiated a restructuring of the terms of the debt agreement. Note: Use appropriate factor(s) from the tables provided. (FV of $1. PV of $1. EVA of $1. PVA of $1. EVAD of $1 and PVAD of $.1) Required: Prepare all journal entries by First Lincoln Bank to record the restructuring and any remaining transactions, for current and future years, relating to the debt under each of the independent circumstances below: 1. First Lincoln Bank agreed to settle the debt in exchange for land having a fair value of $36 million but carried on Rothschild Chair Company's books at $33 million. 2. First Lincoln Bank agreed to (a) forgive the interest accrued from last year, (b)…
The Larisa Company is exiting bankruptcy reorganization with the following account balances: Net Book Value Fair Value Receivables $ 80,000 $ 90,000 Inventory 200,000 210,000 Buildings 300,000 400,000 Liabilities 800,000 800,000 Common stock 130,000 Additional paid-in capital 20,000 Retained earnings (deficit) (370,000) Larisa Company’s assets have a $760,000 reorganization value. As part of the reorganization plan, the company’s owners transferred 80 percent of the outstanding stock to the creditors in exchange for a $500,000 reduction in the liabilities. Required: Prepare the journal entry (or entries) necessary to adjust the company’s records to fresh start accounting. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
Vk
Rothschild Chair Company, Incorporated, was indebted to First Lincoln Bank under a $40 million, 10% unsecured note. The note was signed January 1, 2014, and was due December 31, 2027. Annual interest was last paid on December 31, 2022. At January 1, 2024. Rothschild Chair Company was experiencing severe financial difficulties and negotiated a restructuring of the terms of the debt agreement Note: Use appropriate factor(s) from the tables provided. (FV of $1. PV of $1. FVA of $1. PVA of $1. FVAD of $1 and PVAD of $1) Required: Prepare all journal entries by First Lincoln Bank to record the restructuring and any remaining transactions, for current and future years, relating to the debt under each of the independent circumstances below: 1. First Lincoln Bank agreed to settle the debt in exchange for land having a fair value of $36 million but carried on Rothschild Chair Company's books at $33 million. 2. First Lincoln Bank agreed to (a) forgive the interest accrued from last year, (b)…
47 ABC Corporation has become insolvent and a statement of affairs is being prepared. The following data are given. Market value of assets pledged with fully secured creditors 150,000 Fully secured creditors 50,000 Market value of assets pledged with partly secured creditors 90,000 Partly secured creditors 150,000 Creditors with priority 46,000 Unsecured creditors 80,000 Free assets 76,000 How much is the estimated amount available?
PROBLEM: The creditors of the RR Corp. agreed to a liquidation based on the statement of affairs, suggested that unsecured creditors, without priority would receive approximately P.60 on the peso. The unsecured creditors are interested in determining whether the preliminary estimate still seems appropriate. The trustee was originally assigned noncash asset for P1,480,000 and creditor claims as follows: Fully secured P670,000 Partially secured P400,000 Unsecured with priority P200,000 Unsecured without priority P320,000 Assets with book value of P45,000 and unsecured liabilities, without priority, of P35,000 were subsequently discovered. Assets with a total book value of P740,000 were sold for P715,000 net. Fully secured liabilities of P410,000 and partially secured liabilities of P280,000 were paid. Remaining liquidation expenses were estimated to be P30,000. Assume the remaining noncash assets have an estimated net realizable value as follows: Assets traceable to…
Shi Company is going through a Chapter 7 bankruptcy. All assets have been liquidated, and the company retains only $26,000 in free cash. The following debts, totaling $42,050, 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 Required: Indicate how much money will be paid to the creditor associated with each debt. Types of Debts Administrative expenses Amounts $ 3,250 Salary during last month owed to Mr. Key and Ms. Rankin Government claims to unpaid taxes 0 $ 6,800 18,625 3,250 5,890 7,350
The Larisa Company is exiting bankruptcy reorganization with the following accounts: Book Value Fair Value $ 81,000 $ 92,000 Receivables Inventory Buildings 201,000 301,000 301, 000 331,000 22,000 (71, 000) 212,000 402,000 301,000 Liabilities Common stock Additional paid-in capital Retained earnings (deficit) The company's assets have a $761,000 reorganization value. As part of the reorganization, the company's owners transferred 70 percent of the outstanding stock to the creditors. Prepare the journal entry (or entries) necessary to adjust the company's records to fresh start accounting. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
During the current year, Reed Consulting acquired long-term available-for-sale debt securities on July 1 at a $70,000 cost. At its December 31 year-end, these securities had a fair value of $58,000. This is the first and only time the company purchased such securities. 1. Prepare the July 1 entry to record the purchase of these debt securities. 2. Prepare the year-end adjusting entry related to these securities.