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A statement of financial affairs created for an insolvent corporation that is beginning the process of liquidation discloses the following data (assets are shown at
A statement of financial affairs created for an insolvent corporation that is beginning the process of liquidation discloses the following data (assets are shown at net realizable values):
Assets pledged with fully secured creditors | $ | 220,000 |
Fully secured liabilities | 160,000 | |
Assets pledged with partially secured creditors | 390,000 | |
Partially secured liabilities | 510,000 | |
Assets not pledged | 310,000 | |
Unsecured liabilities with priority | 182,800 | |
Accounts payable (unsecured) | 400,000 | |
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a. | This company owes $13,000 to an unsecured creditor (without priority). How much money can this creditor expect to collect? |
b. | This company owes $120,000 to a bank on a note payable that is secured by a security interest attached to property with an estimated net realizable value of $90,000. How much money can this bank expect to collect? |
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