Illustrate hypothetical calculations that would be done to help creditors understand how much money they might receive if the company

were to liquidate. Ensure all information is entered accurately. Please refer to the illustration (Exhibit 13.2) on page 592 from your textbook to view potential calculations.

Page 592 The land and building are in an excellent location and can be sold for a figure 10 percent above book value. However, the equipment was specially designed for Chaplin. Company officials anticipate having trouble finding a buyer for this equipment unless the price is reduced considerably. Unless they have exceptionally good luck, they expect to receive only 40 percent of current book value for these assets. Administrative costs of $21,500 are projected if the company does liquidate. Accrued expenses are listed on the balance sheet as $18,000. That amount includes salaries of $14,000. This figure includes one person who is owed $13,475 but is the only employee due an amount above $12,475. Other accrued expenses total $4,000. In addition, payroll taxes of $2,000 have been withheld from employee wages but not yet paid to the government or recorded as a liability Interest of $5,000 on the company's long-term liabilities has not yet been accrued for the first six months of 2014 From this information, the statement of financial affairs presented in Exhibit 13.2 for the Chaplin Company was prepared. Several aspects of this statement should be specifically noted