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Shi Company is going through a Chapter 7 bankruptcy. All assets have been liquidated, and the company retains only $26,600 in free cash. The following
Shi Company is going through a Chapter 7 bankruptcy. All assets have been liquidated, and the company retains only $26,600 in free cash. The following debts, totaling $45,050, remain:
Government claims to unpaid taxes | $ | 7,400 |
Salary during last month owed to Mr. Key (not an officer) | 19,225 | |
Administrative expenses | 3,850 | |
Salary during last month owed to Ms. Rankin (not an officer) | 6,625 | |
Unsecured accounts payable | 7,950 | |
Indicate how much money will be paid to the creditor associated with each debt.
Administrative expenses $3,850
Salary during last month owed to Mr. Key and Ms. Rankin $20,275
Government claims to unpaid taxes $2,475
Please explain $20,275
$6,625 for Rankin but how do you calculate the $13,650 for Key?
Please help I am stuck and need an explanation
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