Liquidation Assignment

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To:Emma Newstar

Dec 17 at 9:48 AM

Draw back 24-01
Liquidation

Southwestern Placed on Inc. has the subsequent stability sheet:

Current belongings$1,875,000Accounts payable$375,000
Fixed belongings1,875,000Notes payable750,000
Subordinated debentures750,000
Full debt$1,875,000
Frequent equity1,875,000
Full belongings$three,750,000Full liabilities and equity$three,750,000

The trustee’s costs complete $308,750, and the company has no accrued taxes or wages. Southwestern has no unfunded pension liabilities. The debentures are subordinated solely to the notes payable. If the company goes bankrupt and liquidates, how quite a bit will each class of merchants get hold of if a whole of $three million is acquired from sale of the belongings?

Distribution of proceeds on liquidation:

1. Proceeds from sale of belongings$
2. First mortgage, paid from sale of belongings$
three. Costs and payments of administration of chapter$
4. Wages due employees earned inside three months
earlier to submitting of chapter petition
$
5. Taxes$
6. Unfunded pension liabilities$
7. On the market to regular collectors$

Distribution to regular collectors:

Claims of Fundamental Collectors Declare
(1)
Software program of 100% Distribution
(2)
After Subordination Adjustment
(three)
Proportion of Genuine Claims Acquired
(4)
Notes payable$$$%
Accounts payable$$$%
Subordinated debentures$$$%
Full$$$

The remaining $ will go to the frequent stockholders. Get Finance homework help within the current day