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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 Accounts receivable Inventory Building Equipment Total Assets $2,000 $2,000 66,000 20,000 6,000 3,000 80,000 130,000 36,000 10,000 $190,000 $165,000 Liabilities Salaries payable Taxes payable Accounts payable Loan payable Liquidation costs payable $5,000 10,000 80,000 115,000 5,000 $215,000 secured by building 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. Bottomless Pit Inc. Statement of Affairs 5/1/200X Current Estimated Loss or Fair Amount (Gain) on Carrying Values Available Realization Amounts Carrying Amounts Amount Unsecured Assets Liabilities and Equity Assets: Unsecured with priority: $5,000 Salaries Payable $10,000 Taxes Payable $5,000 Liquidation Costs Payabl $80,000 Building Less Loan Payable $5,000 $10,000 $5,000 $20,000 $6,000 Inventories $2,000 Cash $66,000 Trade Accounts Receivable $36,000 Equipment ####### Loan Payable $115,000 $80,000 Trade Accounts Payable $80,000 $80,000 $0 $0 Total estimated amount available Less with priority Estimated amount available for unsecured creditors ($. on the dollar) Total Liabilities $215,000 Equity ($25,000) $190,000 $190,000 Bottomless Pit Estimated Amounts to be Recovered by Creditors 5/1/200X Estimated Class of Creditor Total ClaimsComputation Recovery Unsecured with Priority Fully Secured Unsecured without Priority Bottomless Pit Statement of Realization and Liquidation For the Month Ended May 31, 200X Non Cash Loan Salary Lig Costs Taxes Accounts Assets Payable Payable Payable Payable Payable Deficit $188,000 $115,000 $5,000 $5,000 $10,000 $80,000 ####### Bottomless Pit Actual Amounts Recovered by Creditors 5/31/200X Estimated Class of Creditor Total ClaimsComputation Recovery Cash Book Balances May 1 $2,000 Sold building and paid loan Collected accounts receivable Sold equipment Paid salaries and taxes Sold inventory Paid liquidation costs Paid settlement to creditors Book balances May 31 Unsecured with Priority Fully Secured Unsecured without priority 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 Accounts receivable Inventory Building Equipment Total Assets $2,000 $2,000 66,000 20,000 6,000 3,000 80,000 130,000 36,000 10,000 $190,000 $165,000 Liabilities Salaries payable Taxes payable Accounts payable Loan payable Liquidation costs payable $5,000 10,000 80,000 115,000 5,000 $215,000 secured by building 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. Bottomless Pit Inc. Statement of Affairs 5/1/200X Current Estimated Loss or Fair Amount (Gain) on Carrying Values Available Realization Amounts Carrying Amounts Amount Unsecured Assets Liabilities and Equity Assets: Unsecured with priority: $5,000 Salaries Payable $10,000 Taxes Payable $5,000 Liquidation Costs Payabl $80,000 Building Less Loan Payable $5,000 $10,000 $5,000 $20,000 $6,000 Inventories $2,000 Cash $66,000 Trade Accounts Receivable $36,000 Equipment ####### Loan Payable $115,000 $80,000 Trade Accounts Payable $80,000 $80,000 $0 $0 Total estimated amount available Less with priority Estimated amount available for unsecured creditors ($. on the dollar) Total Liabilities $215,000 Equity ($25,000) $190,000 $190,000 Bottomless Pit Estimated Amounts to be Recovered by Creditors 5/1/200X Estimated Class of Creditor Total ClaimsComputation Recovery Unsecured with Priority Fully Secured Unsecured without Priority Bottomless Pit Statement of Realization and Liquidation For the Month Ended May 31, 200X Non Cash Loan Salary Lig Costs Taxes Accounts Assets Payable Payable Payable Payable Payable Deficit $188,000 $115,000 $5,000 $5,000 $10,000 $80,000 ####### Bottomless Pit Actual Amounts Recovered by Creditors 5/31/200X Estimated Class of Creditor Total ClaimsComputation Recovery Cash Book Balances May 1 $2,000 Sold building and paid loan Collected accounts receivable Sold equipment Paid salaries and taxes Sold inventory Paid liquidation costs Paid settlement to creditors Book balances May 31 Unsecured with Priority Fully Secured Unsecured without priority
