ENRON Company filed a voluntary bankruptcy petition on July 1, 2011 and the statement of affairs reflects thefollowing amounts:BOOKESTIMATEDCARRYINGCURRENTVALUEP150, 00090, 000210. 000VALUEP185, 000Assets pledge with fully secure creditorsAssets pledge with partially secured creditorsFree Assets60, 000160, 000P 405, 000P 450, 000LiabilitiesLiability with priorityFully secured creditorsPartially secured creditorsUnsecured creditorsP35, 000130, 00090, 000270, 000P 525. 0004. Assume that the assets are converted into cash at the estimated current value and the business isliquidated. How much cash will be available to pay the unsecured non-priority claims?A. P240, 000C. P160, 000D. P125, 000B. P180, 000

Liquidation refers to the winding up of business entity by realizing all the assets and pay off the…

ENRON Company filed a voluntary bankruptcy petition on July 1, 2011 and the statement of affairs reflects the following amounts: BOOK CARRYING ESTIMATED CURRENT VALUE P185, 000 60, 000 160, 000 P 405, 000 VALUE P150, 000 Assets pledge with fully secure creditors Assets pledge with partially secured creditors Free Assets 90, 000 210, 000 P 450, 000 Liabilities P35, 000 130, 000 90, 000 270. 000 P525, 000 Liability with priority Fully secured creditors Partially secured creditors Unsecured creditors

ENRON Company filed a voluntary bankruptcy petition on July 1, 2011 and the statement of affairs reflects the following amounts: BOOK CARRYING ESTIMATED CURRENT VALUE P185, 000 60, 000 160, 000 P 405, 000 VALUE P150, 000 Assets pledge with fully secure creditors Assets pledge with partially secured creditors Free Assets 90, 000 210, 000 P 450, 000 Liabilities P35, 000 130, 000 90, 000 270. 000 P525, 000 Liability with priority Fully secured creditors Partially secured creditors Unsecured creditors

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A company preparing for a Chapter 7 liquidation has listed the following liabilities: Note payable A of $124,000 secured by land having a book value of $67,000 and a fair value of $87,000. Note payable B of $154,000 secured by a building having a $77,000 book value and a $57,000 fair value. Note payable C of $77,000, unsecured. Administrative expenses payable of $37,000. Accounts payable of $137,000. Income taxes payable of $47,000. The company also has these other assets: Cash of $27,000. Inventory of $134,000 but with a net realizable value of $77,000. Equipment of $124,000 but with a net realizable value of $67,000. Based on this information, how much will each of the company’s liabilities be paid at liquidation? Please don't provide answer in image format thank you
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…
Mondesto Company has the following debts: Unsecured creditors Liabilities with priority Secured liabilities: Debt 1, $246,000; value of pledged asset Debt 2, $206,000; value of pledged asset Debt 3, $138,000; value of pledged asset $ 248,000 128,000 Selling value of free assets 198,000 118,000 176,000 The company also has a number of other assets that are not pledged in any way. The creditors holding Debt 2 want to receive at least $170,800. For how much do the free assets have to be sold so that the creditors associated with Debt 2 will receive exactly $170,800?
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8 ABC Company filed for a voluntary bankruptcy which was granted after having submitted all the required papers and documents. You are provided the following information as of June 30, 2022: Assets Net Book Value Liquidation Value Cash P 4,997 Investments in equity securities 25,000 P40,000 plus uncollected dividends of P5,000 Accounts receivable, net 54,000 P28,000 expected collection Inventory 75,000 P100,000 after further processing of P10,000 Prepaid expense 8,000 P2,000 is refundable Land 140,000 150% of net book value Building, net 200,000 90% of net book value Equipment 80,000 30% of net book value Goodwill 10,000 Liabilities and Equity Carrying Value Other Information Notes payable P120,000 Secured by inventory Trade and other payables 100,000 Loans payable 350,000 Secured by land and…
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Kheena Company filed a voluntary bankruptcy petition on June 1, 2022 and the statement of affairs reflects the following amounts: Assets pledged with fully secured creditors has a book value of P160,000 while the estimate( realizable value amounted to P190,000. Assets pledged with partially secured creditors has estimated realizable value of P60,000 with book value of P90,000. But the free assets amounted to P140,000 and P200,00 for the realizable and book value, respectively. Liabilities were as follows: Liabilities with priority 20,000 Fully Secured creditors 130,000 Partially secured creditors 100,000 Unsecured creditors 260,000 Q2. If the assets are converted into cash at the estimated realizable values, what is the ERP for partially secured creditors?
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