The inventory can be sold for P30,000 and is expected to incurshipping costs and selling expenses amounting to P1,000. Fairmarket value of the equipment amounted to P4,200.The notes receivable are pledged as a security on a note payableof P40,000. A note payable of P20,000 is secured by a lien onthe building, and the equipment is pledged as security on a notepayable of P10,000. One-half of the interest payable relates toP40,000 note payable; the other half of the interest payablerelates to the P20,000 note payable. There is no accrued intereston the other notes payable.Accounts payable and other liabilities include debts, taxes andassessments due to the National Government amounting toP10,000.The books do not show the estimated trust fees, accounting andlegal fees, amounting to P5,000, which will be incurred inconnection with the liquidation.Requirement: Compute for the payment to each class of creditor. Miner Company is being forced into bankruptcy. TheCompany's creditors and stockholders have requested anestimate of the results of liquidation of the Company. Miner'strial balance follows:AccountsDebit CreditCashP6,000Accounts receivable63,000Allowance for bad debtsP2,000Notes receivable50,000Accrued interest on notes receivable 1,200InventoryBuildingsAccumulated depreciation-BuildingsEquipmentAccumulated depreciation-EquipmentPrepaid insurance60,000182,00063,00014,6001,4001,100Goodwill8,500Accrued wagesTaxes payableAccounts payable and other liabilitiesNotes payableAccrued interest payableCommon stock6,0002,400170,00080,0001,600110,00050,000Retained earnings (deficit)TotalP436,400 P436 400The assets are expected to bring cash on conversion in thefollowing amountsAccounts receivableP50,000Notes receivable including P1,000 accruedinterest40,800Building75,000Prepaid insurance400

The process by which a company or organization stops operating, sells off its assets, settles its…

Miner Company is being forced into bankruptcy. The Company's creditors and stockholders have requested an estimate of the results of liquidation of the Company. Miner's trial balance follows: Accounts Cash Accounts receivable Allowance for bad debts Notes receivable 50,000 Accrued interest on notes receivable 1,200 60,000 182,000 Debit Credit P6,000 63,000 Inventory Buildings Accumulated depreciation-Buildings Equipment Accumulated depreciation-Equipment Prepaid insurance Goodwill Accrued wages Taxes payable Accounts payable and other liabilities Notes payable Accrued interest payable Common stock Retained earnings (deficit) Total 14,600 1,100 8,500 P2,000 63,000 Accounts receivable Notes receivable including P1,000 accrued interest Building Prepaid insurance 1,400 6,000 2,400 170,000 80,000 1,600 110,000 50,000 P436,400 P436,400 The assets are expected to bring cash on conversion in the following amounts P50,000 40,800 75,000 400

Miner Company is being forced into bankruptcy. The Company's creditors and stockholders have requested an estimate of the results of liquidation of the Company. Miner's trial balance follows: Accounts Cash Accounts receivable Allowance for bad debts Notes receivable 50,000 Accrued interest on notes receivable 1,200 60,000 182,000 Debit Credit P6,000 63,000 Inventory Buildings Accumulated depreciation-Buildings Equipment Accumulated depreciation-Equipment Prepaid insurance Goodwill Accrued wages Taxes payable Accounts payable and other liabilities Notes payable Accrued interest payable Common stock Retained earnings (deficit) Total 14,600 1,100 8,500 P2,000 63,000 Accounts receivable Notes receivable including P1,000 accrued interest Building Prepaid insurance 1,400 6,000 2,400 170,000 80,000 1,600 110,000 50,000 P436,400 P436,400 The assets are expected to bring cash on conversion in the following amounts P50,000 40,800 75,000 400

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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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
After the end of the reporting period, prior to authorizing for issue the financial statementsof Chubby the Piggy Ltd for the year ended 31 March 20X7 the following issues were raised:1. The notification of the bankruptcy of a customer: The balance of trade receivablesdue from the customer at 31 March 20X7 was $23,000 and at the date of thenotification it was $25,000. No payment is expected from the bankruptcyproceedings.2. Sales of some items of product ChoCoCo were made at a price of $5,40 each in Apriland May 20X7. Sales staff receives a commission of 15% of the sales price on theseproducts. At 31 March 20X7 the company had 12,000 units of this product ininventory included at cost of $6 each.3. The company is being sued by an employee who lost a limb in an accident while atwork on March 15 20X7. The company is contesting the claim as the employee wasnot following the safety procedures that he had been instructed to follow.Accordingly the financial statements include a note of a…
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…
Martinez Corp. experienced a fire on December 31, 2020, in which its financial records were partially destroyed. It has been able to salvage some of the records and has ascertained the following balances. December 31, 2020 December 31, 2019 Cash $ 38,100 $ 11,100 Accounts receivable (net) 74,000 128,400 Inventory 204,600 183,400 Accounts payable 50,200 90,600 Notes payable 36,500 64,900 Common stock, $100 par 406,600 406,600 Retained earnings 120,000 106,300 Additional information: 1. The inventory turnover is 3.7 times. 2. The return on common stockholders’ equity is 19%. The company had no additional paid-in capital. 3. The receivables turnover is 11.8 times. 4. The return on assets is 19%. 5. Total assets at December 31, 2019, were $607,100. Compute the following for Martinez Corp.. (Round all answers to 0 decimal places, e.g. 2,150.) (a) Cost of goods sold for 2020. $ (b) Net credit…
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
Please help me. Thankyou.
On April 15, 2018 Mike’s Framing Co., declared Chapter 11 bankruptcy, owing James Wholesalers $375.00. James will immediately write off Mike’s account as uncollectible. Prepare the appropriate journal entry for James.
How much is the estimated recovery percentage?
Use the trial balance presented for Lynch, Inc., in problem (51). Assume that the company will be liquidated and the following transactions will occur: • Accounts receivable of $18,000 are collected with remainder written off. • All of the company’s inventory is sold for $40,000. • Additional accounts payable of $10,000 incurred for various expenses such as utilities and maintenance are discovered. • The land and building are sold for $71,000. • The note payable due to the Colorado Savings and Loan is paid. • The equipment is sold at auction for only $11,000 with the proceeds applied to the note owed to the First National Bank. • The investments are sold for $21,000. • Administrative expenses total $20,000 as of July 23, 2017, but no payment has yet been made. a. Prepare a statement of realization and liquidation for the period from March 14, 2017, through July 23, 2017. b. How much cash would be paid to an unsecured, nonpriority creditor that Lynch, Inc., owes a total of $1,000?
What are possible reasons for a company with $20 million worth of assets that files for chapter 7 bankruptcy and a secured creditor with claims of over $100 million and the building as a secuirty end up with nothing?
Shi Company is going through a Chapter 7 bankruptcy. All assets have been liquidated, and the company retains only $27,500 in free cash. The following debts, totaling $49,550, remain: Government claims to unpaid taxes $ 8,300 Salary during last month owed to Mr. Key (not an officer) 20,125 Administrative expenses 4,750 Salary during last month owed to Ms. Rankin (not an officer) 5,960 Unsecured accounts payable 8,850 Required: Indicate how much money will be paid to the creditor associated with each debt.
ASAP