Note: You will have to use a pen and a paper to work the question out fully as it will be used to answer Q12 and Q16

Mohammed Ltds assets have the carrying values and estimated fair values as follows:

	Carrying value ($)	Fair value ($)
Cash	16,000	16,000
Accounts Receivable	60,000	50,000
Inventory	90,000	65,000
Land	100,000	80,000
Building	220,000	160,000
Equipment (net)	250,000	100,000
Total	736,000	471,000

Mohammeds debts are as follows:

Accounts payable	$110,000
Wages payable (all have priority)	10,500
Taxes payable	16,000
(Notes payable (secured by receivables and inventory))	190,000
Interest on notes payable	5,000
Bonds payable (secured by land and building)	220,000
Interest on bonds payable	11,000
Total	$562,500

How much will be distributed to accounts payable?

How much will be distributed to notes payable?