Borden Corporation is undergoing a Chapter 7 liquidation. Currently, it has cash of $130,000, inventory of $650,000, and equipment of $775,000. It owes an unsecured bank loan payable of $500,000 and unsecured accounts payable of $1,600,000. During the current month, the Receiver sells Borden's entire inventory to a liquidator for $290,000. The entire cash balance is then distributed to unsecured creditors.

The receiver's payment to the bank is

A $500,000.

B $420,000.

C $100,000.

D $290,000.

Mannheim Corporation is ready to emerge from Chapter 11 bankruptcy under a reorganization plan accepted by all parties. Mannheim's balance sheet shows:

Various assets $2,000,000 Prepetition liabilities, fully secured $ 400,000

Prepetition liabilities subject to compromise 1,360,000

Postpetition liabilities 820,000

Shareholders' equity (580,000)

TOTAL $2,000,000 TOTAL $2,000,000

A $2,370,000.

B $2,000,000.

C $2,580,000.

D $1,760,000.

New equity interests in the reorganized company are $160,000. The present value of future cash flows from the reorganized company's operating assets is $2,370,000. The compromised amount of Mannheim's prepetition liabilities is

A $1,360,000.

B $1,390,000.

C $2,210,000.

D $ 990,000.