The balance sheet of 1680 MARKETING Corporation at August 31, 2014 contains the following items: Assets P 400, 000 700, 000 500, 000 300, 000 2, 000, 000 Cash Accounts receivable – net Inventories Land Building – net Machinery - net Goodwill 500, 000 P5.000, 000 Equities Accounts payable Wages payable Property taxes payable Mortgage payable Interest on mortgage payable Note payable - unsecured Interest payable – unsecured Capital stock Retained earnings (deficit) P1, 100, 000 600, 000 100, 000 1, 500, 000 150, 000 500, 000 50, 000 2, 000, 000 (1. 000, 000) P5. 000, 000 The company is in financial difficult and its stockholders and creditors have requested a statement of affairs for planning purposes. The following information is available: The company estimates that P370, 000 is the maximum amount collectible for the accounts receivable. v Except for 20% of the inventory items that are damaged and worth only P20, 000, the cost of other items is expected to be recovered in full. v The land and building have a combined appraisal value of P1, 700, 000 and are subject to the P1, 500, 000 mortgage and related accrued interest. * The appraised value of the machinery is P120, 000. v Wages payable and property taxes payable are unsecured priority items that do not exceed any limitation of the Bankruptcy Act. 2. How much is the estimated settlement per peso of unsecured liabilities? A. PO. 75 В. РО.40 С. РО.50 D. PO.75
The balance sheet of 1680 MARKETING Corporation at August 31, 2014 contains the following items: Assets P 400, 000 700, 000 500, 000 300, 000 2, 000, 000 Cash Accounts receivable – net Inventories Land Building – net Machinery - net Goodwill 500, 000 P5.000, 000 Equities Accounts payable Wages payable Property taxes payable Mortgage payable Interest on mortgage payable Note payable - unsecured Interest payable – unsecured Capital stock Retained earnings (deficit) P1, 100, 000 600, 000 100, 000 1, 500, 000 150, 000 500, 000 50, 000 2, 000, 000 (1. 000, 000) P5. 000, 000 The company is in financial difficult and its stockholders and creditors have requested a statement of affairs for planning purposes. The following information is available: The company estimates that P370, 000 is the maximum amount collectible for the accounts receivable. v Except for 20% of the inventory items that are damaged and worth only P20, 000, the cost of other items is expected to be recovered in full. v The land and building have a combined appraisal value of P1, 700, 000 and are subject to the P1, 500, 000 mortgage and related accrued interest. * The appraised value of the machinery is P120, 000. v Wages payable and property taxes payable are unsecured priority items that do not exceed any limitation of the Bankruptcy Act. 2. How much is the estimated settlement per peso of unsecured liabilities? A. PO. 75 В. РО.40 С. РО.50 D. PO.75
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The balance sheet of 1680 MARKETING Corporation at August 31, 2014 contains the following items:
Assets
Cash
Accounts receivable - net
Inventories
P 400, 000
700, 000
500, 000
300, 000
Land
Building – net
Machinery – net
2, 000, 000
600, 000
500, 000
P5. 000, 000
Goodwill
Equities
Accounts payable
Wages payable
Property taxes payable
Mortgage payable
Interest on mortgage payable
Note payable – unsecured
Interest payable – unsecured
Capital stock
Retained earnings (deficit)
P1, 100, 000
600, 000
100, 000
1, 500, 000
150, 000
500, 000
50, 000
2, 000, 000
(1. 000, 000)
P5. 000, 000
The company is in financial difficult and its stockholders and creditors have requested a statement of affairs for
planning purposes. The following information is available:
The company estimates that P370, 000 is the maximum amount collectible for the accounts receivable.
Except for 20% of the inventory items that are damaged and worth only P20, 000, the cost of other items is
expected to be recovered in full.
The land and building have a combined appraisal value of P1, 700, 000 and are subject to the P1, 500, 000
mortgage and related accrued interest.
The appraised value of the machinery is P120, 000.
v Wages payable and property taxes payable are unsecured priority items that do not exceed any limitation
of the Bankruptcy Act.
2. How much is the estimated settlement per peso of unsecured liabilities?
A. PO. 75
В. РО.40
С. РО.50
D. PO.75
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