Poster Inc. filed for bankruptcy under Chapter 11 on January 1, 2019. Below is the information on their financial condition immediately before the reorganization was approved by the court on June 30, 2019 (all in US dollars): Cash Account receivables - net Inventories PPE - net Patent Book Value Fair Value 150,000,000 150,000,000 52,500,000 50,000,000 30,000,000 60,000,000 235,000,000 240,000,000 25,000,000 0 492 500.000 Account receivables Salary and wages payables Prepetition liabilities Common shares Deficit 55,000,000 75,000,000 305,000,000 210,000,000 (152,500,000) 492,500,000 In the reorganization plan, the reorganization value was estimated for $350,000,000. Prepetition liabilities consisted of account payables $65,000,000 and note payables for Kasuari Bank $240,000,000. Rorganization plan also resulted in negotiation with creditors as follows: Account payables (prepetition) Will be paid 75% Note payables (prepetition) Will be converted into $92,000,000 note payables and $100,000,000 common stocks Common stocks Converted into $75,000,000 shares of emerging entity Required: a. Show whether Poster Inc. is eligible for fresh-start reporting. b. Prepare adjusting entries to open a balance sheet after the reorganization. c. Prepare the balance sheet of the emerging entity. Poster Inc. filed for bankruptcy under Chapter 11 on January 1, 2019. Below is the information on their financial condition immediately before the reorganization was approved by the court on June 30, 2019 (all in US dollars): Cash Account receivables - net Inventories PPE - net Patent Book Value Fair Value 150,000,000 150,000,000 52,500,000 50,000,000 30,000,000 60,000,000 235,000,000 240,000,000 25,000,000 0 492 500.000 Account receivables Salary and wages payables Prepetition liabilities Common shares Deficit 55,000,000 75,000,000 305,000,000 210,000,000 (152,500,000) 492,500,000 In the reorganization plan, the reorganization value was estimated for $350,000,000. Prepetition liabilities consisted of account payables $65,000,000 and note payables for Kasuari Bank $240,000,000. Rorganization plan also resulted in negotiation with creditors as follows: Account payables (prepetition) Will be paid 75% Note payables (prepetition) Will be converted into $92,000,000 note payables and $100,000,000 common stocks Common stocks Converted into $75,000,000 shares of emerging entity Required: a. Show whether Poster Inc. is eligible for fresh-start reporting. b. Prepare adjusting entries to open a balance sheet after the reorganization. c. Prepare the balance sheet of the emerging entity