Chapter 7 Liquidation, Statement of Affairs Name Brand Company is to be liquidated under Chapter 7 of the Bankruptcy Code. The balance sheet on July 31, 20X1, follows: Assets Cash Marketable Securities Accounts Receivable (net) Inventory Prepaid Insurance Land Plant & Equipment (net) Franchises $ 5,000 30,000 105,000 160,000 7,000 80,000 412,000 72,000 Total $871,000 Liabilities and Equities Accounts Payable Wages Payable Taxes Payable Interest Payable Notes Payable Mortgages Payable Common Stock ($20 par) Retained Earnings (deficit) $265,000 20,000 12,000 37,000 280,000 220,000 240,000 (203,000) $871,000 Total Additional Information 1. Marketable securities consist of 1,000 shares of Wooly Inc. common stock. The stock's market value per share is $22. The stock was pledged against a $28,000, 10 percent note payable that has accrued interest of $1,400. 2. Accounts receivable of $50,000 are collateral for a $40,000, 12 percent note payable that has accrued interest of $4,000. 3. Inventory with a book value of $79,000 and a current value of $75,000 is pledged against accounts payable of $105,000. The appraised value of the remainder of the inventory is $76,000. 4. Only $1,500 will be recovered from prepaid insurance. 5. Land is appraised at $110,000 and plant and equipment at $340,000. 6. It is estimated that the franchises can be sold for $30,000. 7. All wages payable qualify for priority. 8. The mortgages are on the land and a building with a book value of $162,000 and an appraised value of $150,000. The accrued interest on the mortgages is $14,600. 9. Estimated legal and accounting fees for the liquidation are $13,000. Required a. Prepare a statement of affairs as of July 31, 20X1. b. Compute the estimated percentage settlement to unsecured creditors