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A firm is facing financial difficulties due to overleverage and decides to file for bankruptcy. Administrative costs and fees amount to 5% of the going
A firm is facing financial difficulties due to overleverage and decides to file for bankruptcy. Administrative costs and fees amount to 5% of the "going concern" value which is expected to be 28.2 million. The following table shows the firms current balance sheet: Assets Current Assets Fixed Assets 6 9 41 Equity and Liabilities Current Liabilities Senior Debt Junior Debt Equity 54 21 37 48% of the senior claim is secured by fixed assets. According to rules of priority, how much of the proceeds should be distributed to Senior debt. Select one: O a. 2.32 O b. 266.86 O c. 2.89 O d. 0.99 O e. 7.11 O f. 23.47 O g. 5.97 O h. 1.41 O i. 19.68 O j. 24.23 Ok. 22.57 O 1.3.79
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