Marvel went belly up in late 2020 after the speculative collectors market cratered in its core comic book business and the trading card business, which it had expanded into with the acquisitions of Fleer and Skybox. After months of legal battles and quickly found stable footing with Marvel Studios, a pre-production studio as a form of quasi-reorganization was not able to sustain its losses. Marvel seek restructuring its projects which had been held up after being sold to major studios, the new studio allowed Marvel to expedite the process by commissioning scripts and hiring key actors and directors. Movies like Blade, X-Men, and especially Spider-Man succeeded at the box office, and Marvel enjoyed a small licensing fee, a huge boost in comic sales, and other licensing opportunities. However, these were not enough to cover all its previously incurred liabilities and costs paid to legal disputes. Thus, Marvel has decided to seek liquidation after previous restructuring and quasi-reorganization attempts failed. The Marvel Company has the following condensed balance sheet as of March 31,2021. Assets Liabilities and Stockholders’ Equity Cash P12,000 Accrued Payroll P40,000 Receivables (net) 280,000 Loans from Officer 50,000 Inventory 70,000 Accounts Payable 60,000 Prepaid Expenses 1,000 Equipment Loan Payable 360,000 Plant Assets 300,000 Business Loan Payable 180,000 Goodwill 39,000 Common Stock 60,000 ___________ Deficit (48,000) Total P702,000 Total P702,000 The equipment loan payable is secured by specific plant assets having a book value of P300,00 and a realizable value of P350,000. Of the accounts payable, P40,000 is secured by inventory which has a cost of P40,000 and a liquidation value of P44,000. The balance of the inventory has a realizable value of P32,00. Receivables with a book value and market value of P100,000 and P80,000 respectively have been pledged as collateral on the business loan payable. The balance of the receivables have a realizable value of P150,000. Compute fort the following: A. Estimated Amount Paid to Unsecured Creditors with Priority is: B. Estimated Amount Paid to Fully Secured Creditors is: C. Estimated Amount Paid to Unsecured Creditors Without Priority is: D. Estimated Payment to Partially Secured Creditors is: E. Estimated Payment to Creditors is:
Marvel went belly up in late 2020 after the speculative collectors market cratered in its core
comic book business and the trading card business, which it had expanded into with the
acquisitions of Fleer and Skybox. After months of legal battles and quickly found stable
footing with Marvel Studios, a pre-production studio as a form of quasi-reorganization was
not able to sustain its losses. Marvel seek restructuring its projects which had been held up
after being sold to major studios, the new studio allowed Marvel to expedite the process by
commissioning scripts and hiring key actors and directors. Movies like Blade, X-Men, and
especially Spider-Man succeeded at the box office, and Marvel enjoyed a small licensing fee,
a huge boost in comic sales, and other licensing opportunities. However, these were not
enough to cover all its previously incurred liabilities and costs paid to legal disputes. Thus,
Marvel has decided to seek liquidation after previous restructuring and quasi-reorganization
attempts failed. The Marvel Company has the following condensed
31,2021.
Assets Liabilities and
Cash P12,000 Accrued Payroll P40,000
Receivables (net) 280,000 Loans from Officer 50,000
Inventory 70,000 Accounts Payable 60,000
Prepaid Expenses 1,000 Equipment Loan Payable 360,000
Plant Assets 300,000 Business Loan Payable 180,000
___________ Deficit (48,000)
Total P702,000 Total P702,000
The equipment loan payable is secured by specific plant assets having a book value of P300,00
and a realizable value of P350,000. Of the accounts payable, P40,000 is secured by inventory
which has a cost of P40,000 and a liquidation value of P44,000. The balance of the inventory
has a realizable value of P32,00. Receivables with a book value and market value of P100,000
and P80,000 respectively have been pledged as collateral on the business loan payable. The
balance of the receivables have a realizable value of P150,000. Compute fort the following:
A. Estimated Amount Paid to Unsecured Creditors with Priority is:
B. Estimated Amount Paid to Fully Secured Creditors is:
C. Estimated Amount Paid to Unsecured Creditors Without Priority is:
D. Estimated Payment to Partially Secured Creditors is:
E. Estimated Payment to Creditors is:
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