Bottomless Pit Inc. files a voluntary petition for bankruptcy on May 1, 200X which includes the following assets and liabilities:

Carrying Realizable

Amount Amount

Assets

Cash $2,000 $2,000

Accounts receivable 66,000 20,000

Inventory 6,000 3,000

Building 80,000 130,000

Equipment 36,000 10,000

Total Assets $190,000 $165,000

Liabilities

Salaries payable $5,000

Taxes payable 10,000

Accounts payable 80,000

Loan payable 115,000 secured by building

Liquidation costs payable 5,000

TOTAL $215,000

Prepare a Statement of Affairs and a Schedule of Estimated Amounts to be Recovered by Creditors as of May 1, 200X.

On May 1, 200X the Bankruptcy Court appointed you as trustee to administer the assets and liquidate the company. Show the journal entries transferring the assets and liabilities to you and for the following transactions for the month of May 200X:

A. Sold the building for $120,000 and paid the loan.

B. Collected $10,000 from the accounts receivable. Remainder is uncollectible

C. Sold the equipment for $8,000

D. Paid the salaries and taxes payable.

E. Sold all remaining inventory for $8,000

F. Paid liquidation costs.

G. Distributed settlement to remaining creditors

Prepare a Statement of Realization and Liquidation for Bottomless Pit for the month of May 200X.