1.Bye-bye Corporation is undergoing liquidation . Relevant information as of January 1, 20x1 is shown beolow:

Assets - Carrying amounts - Realizable value

Cash - 200,000 - 200,000

Accounts receivable - 500,000 - 450,000

Equipment net - 600,000 - 150,000

Land - 1,000,000 - 1,300,000

Total Assets - 2,300,000 - 2,100,000

Liabilities - Carrying amounts - realizable Value

Accounts payable - 700,000 - 700,000

Salaries payable - 800,000- 800,000

Note payable- 500,000- 500,000

Loan payable -750,000 -750,000

Total Liab - 2,750,00- 2,750,000

Equity- Carrying amount - Realizable value

Share capital 1,000,000

Deficit (1,450,000)

Capital deficiency (450,000)

Total Liab and equity 2,300,000

Additional information:

-Administrative expenses of 180,000 are expected to be incurred during the liquidation process

-The equipment is pledged as collateral security for the note payable

-The land is pledged as collateral security for the loan payable

Requirements:

a.Compute for the amounts of the following;

-assets pledged to fully secured creditors

-assets pledged to partially secured creditors

-free assets and net free assets

b. Compute for the amounts of the following;

-unsecured liabilities with priority

-fully secured liabilities

-partially secured liabilities

-unsecured liabilities without priority

c. Compute for the estimated deficiency

d. compute for the estimated recovery percentage of unsecured creditors without priority

e. Mr. A, an unsecured non-priority creditor, has a 500,000 claim. How can Mr. A expect to collect fromBye-Bye Corporation?

f. Prepare the statement of affairs

2.Bye-bye Corporation is undergoing liquidation . Relevant information as of January 1, 20x1 is shown beolow:

Assets - Carrying amounts

Cash - 200,000

Accounts receivable - 500,000

Equipment net - 600,000

Land - 1,000,000

Total Assets - 2,300,000

Liabilities - Carrying amounts

Accounts payable - 700,000

Salaries payable - 800,000

Note payable- 500,000

Loan payable -750,000

Total Liab - 2,750,000

Equity- Carrying amount

Share capital 1,000,000

Deficit (1,450,000)

Capital deficiency (450,000)

Total Liab and equity 2,300,000

Bye- bye liquidation is entrusted to Hello, a receiver.

Information on Jaunuary 1, 20x1:

-interest of 30,000 is expected to be paid on the loan

-liquidation costs of 180,000 are expected to be incurred

Information on transactions for the year ended Dec. 31, 20x1:

a.280,000 were collected on 400,000 accounts receivable

b.the equipment was sold for 150,000, net of 40,000 disposal costs. The net proceeds were used to fully settle the note payable. The creditor canceled the balance.

c.the land was sold for 1,500,000. Disposal costs of 100,000 were incurred on the sale. The net proceeds were used to fully settle the loan payable, including the interest.

d.Half of the accounts payable and one-fourth of the salaries payable were settled

e. Liquidation costs of 240,000 were paid. Additional 120,000 are expected to be incurred in 20x2.

Requirements:

a.what are the journal entries in the book of the receivers of the following:

-opening journal entries

-new assets and liabilities

-transaction during 20x1

b.prepare the statement of realization and liquidation

c. compute for the ending balance

d.compute for the ending balance of the estate deficit account and make a reconciliation for the computed cash balance.