The mortgage payable is secured by the Building having a realizable value of P400,000. Accounts Payable amounting to P75,000 is secured by receivables amounting to P90,600 (P9,900 of which is uncollectible). The balance of receivables which has a realizable value of P187,500 is used to secure the loan payable. Inventory has a realizable
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Nissan Corporation is undergoing liquidation. On January 1, 2020 its
ASSETS LIABILITIES AND EQUITY
Cash P 150,000 Salaries Payable P 85,000
Inventory 50,000 Mortgages Payable 428,000
Prepaid Expenses 10,400 Loan Payable 130,000
Building 380,000 Notes Payable 84,300
Deficit (57,000)
TOTAL P 961,000 TOTAL P 961,000
The mortgage payable is secured by the Building having a realizable value of P400,000. Accounts Payable amounting to P75,000 is secured by receivables amounting to P90,600 (P9,900 of which is uncollectible). The balance of receivables which has a realizable value of P187,500 is used to secure the loan payable. Inventory has a realizable value of P41,200. In addition to recorded liabilities are: accrued interest on mortgage payable amounting to P4,280, liquidation expenses amounting P11,300 and taxes amounting to P5,600. Prepaid expenses and goodwill have no realizable values.
(NOTE: Use 2 decimal places for estimated recovery percentage ex. 88.89%)
What is the total net free assets?
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