Go-for-Broke Company is being liquidated under Chapter 7 of the bankruptcy code. When it filed for bankruptcy, its balance sheet was as follows:

Assume that the liquidation is a voluntary petition, that no unpaid contributions to employee benefit plans exist, and that no customer layaway deposits are involved. The proceeds from the liquidation of the company’s assets are as follows:

Bankruptcy administration charges are $643,750.
a. Determine the distribution (dollar amount and percentage) of the liquidation
proceeds among the various creditors of Go-for-Broke.
b. Assume that the debentures ($2.45 million) are subordinated to bank notes payable.
Determine the distribution (dollar amount and percentage) of the liquidation
proceeds among the various creditors of Go-for-Broke.