1)Magic Mobile Homes is to be liquidated. All creditors, both secured and unsecured, are owed $2.0 million dollars. Administrative costs of liquidation and wages payments are expected to be $500,000. A sale of assets is expected to bring $1.8 million after all costs and taxes. Secured creditors have a mortgage lien for $1,200,000 on the factory which will be liquidated for $900,000 out of the sale proceeds. The corporate tax rate is 34%.

How much and what percentage of their claim will the unsecured creditors receive, in total?

$290,909; 36.36%

$300,000; 37.50%.

$600,000; 75.00%

$100,000; 12.50%

Answer is 600000; 75%. please explain why