Question
In: Finance
Laura, Inc. is being liquidated under Chapter 7 of the Bankruptcy Act. Its current balance sheet...
Laura, Inc. is being liquidated under Chapter 7 of the Bankruptcy Act. Its current balance sheet is shown below. Fixed assets are sold for $30,000,000 and current assets are sold for $10,000,000. All fixed assets are pledged as collateral for all mortgage bonds. Subordinated debentures are subordinate only to notes payable. Trustee costs are $1,000,000. No employee is owed over $2,000. IN EXCEL PLEASE WITH STEPS SHOWN.
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a. How much will SHs receive? |
b. How much will mortgage bondholders receive?
c. How much will priority creditors receive?
d. Identify the remaining general creditors. How much will each receive before subordination adjustment?
e. How much will each of the general creditors receive after subordination adjustment?
Solutions
jeff jeffy answered 1 year agoRelated Solutions
Xavier Company is going through a Chapter 7 bankruptcy. All assets have been liquidated, and the...
Xavier Company is going through a Chapter 7 bankruptcy. All
assets have been liquidated, and the company retains only $25,500
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Government claims to unpaid taxes
$
6,300
Salary during last month owed to Mr. Key (not an officer)
18,125
Administrative expenses
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Salary during last month owed to Ms. Rankin (not an
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5,525
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A debtor (Joe Corp) has filed for chapter 7 bankruptcy. the
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Cash 10 Lien Against Building 80
Building 100 Priority Creditors 30
Unsecured Creditors 20
Total Assets 110 Total Liabilities. -130
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Han is in bankruptcy and is being liquidated by a
court-appointed trustee. The financial report that follows was
prepared by the trustee just before the final cash
distribution:AssetsCash $300,000Approved ClaimsMortgage payable (secured by property that was sold for
$100,000) $180,000Accounts payable, unsecured 160,000Administrative expenses payable, unsecured 16,000Salaries payable, unsecured 4,000Interest payable, unsecured 20,000Total approved claims $380,000The administrative expenses are for trustee fees and other costs
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On November 12, Drowner filed for relief under the provisions of Chapter 7 of the Bankruptcy...
On November 12, Drowner filed for relief under the provisions of
Chapter 7 of the Bankruptcy Code. Prior to filing, Drowner advised
his attorney that he had engaged in the following activities and
transactions. On June 1, he paid the equivalent of three mortgage
payments on his home to Fidelity Funding. On August 15, his prior
landlord seized $4,100 from his bank account to satisfy a three
year old judgment for rent. On November 1, he (Drowner) paid off
his...
On November 12, Drowner filed for relief under the provisions of Chapter 7 of the Bankruptcy...
On November 12, Drowner filed for relief under the provisions of
Chapter 7 of the Bankruptcy Code. Prior to filing, Drowner advised
his attorney that he had engaged in the following activities and
transactions. On June 1, he paid the equivalent of three mortgage
payments on his home to Fidelity Funding. On August 15, his prior
landlord seized $4,100 from his bank account to satisfy a three
year old judgment for rent. On November 1, he (Drowner) paid off
his...
Duchon Industries had the following balance sheet at the time it defaulted on its interest payments and filed for liquidation under Chapter 7.
12/8/2012
Chapter:
24
Problem:
5
Duchon Industries had the following balance sheet at the time it
defaulted on its interest payments and filed for liquidation under
Chapter 7. Sale of the fixed assets, which were pledged as
collateral to the mortgage bondholders, brought in $900 million,
while the current assets were sold for another $400 million. Thus,
the total proceeds from the liquidation sales were $1,300 million.
Trustee's costs amounted to $1 million; no single worker was due
more than...
Jon and Susan Bogren filed for voluntary bankruptcy under Chapter 7 and qualified by passing the...
Jon and Susan Bogren filed for voluntary bankruptcy under
Chapter 7 and qualified by passing the means test. They own one car
outright that has a value of $3,000, and they owe $10,000 to the
bank for their second car. Their bankruptcy action will cause them
to incur attorney’s fees, trustee fees, and court costs. Jon owes
alimony and child support to his former wife and children. Jon and
Susan also owe income taxes and penalties from 2015, and Susan...
Jon and Susan Bogren filed for voluntary bankruptcy under Chapter 7 and qualified by passing the...
Jon and Susan Bogren filed for voluntary bankruptcy under
Chapter 7 and qualified by passing the means test. They own one car
outright that has a value of $3,000, and they owe $10,000 to the
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Provide examples of companies that filed for Chapter 7 and Chapter 11 bankruptcy.
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Choose at least two concepts from the following: partnership, corporation, liquidation, bankruptcy chapter 7, bankruptcy chapter...
Choose at least two concepts from the following: partnership,
corporation, liquidation, bankruptcy chapter 7, bankruptcy chapter
11, reorganization, trust, estates, consolidation, parent company,
subsidiary, acquisition, partnerships termination, variable
interest entity, equity method, fair value method.
Required:
Explain how you may use them in your present or future
accounting position. Make sure you provide details to include how
each concept will help you support the financial goals of the
company you currently work for or will work for in the future.
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