Smith Corporation has gone through bankruptcy and is ready to emerge as a reorganized entity on December 31, 2020. On this date, the company has the following assets (fair value is based on discounting the anticipated future cash flows): Accounts receivable Inventory Land and buildings Machinery Patents Book Value Fair Value $ 19,100 $ 21,100 157,000 125,000 271,000 299,000 133,900 110,900 107,000 132,000 The company has a reorganization value of $828,000. Smith has 52,300 shares of $10 par value common stock outstanding. A deficit Retained Earnings balance of $697,000 also is reported. The owners will distribute 35,400 shares of this stock as part of the reorganization plan. The company's liabilities will be settled as follows: Accounts payable of $196,000 (existing at the date on which the order for relief was granted) will be settled with an 8 percent, two-year note for $36,000. Accounts payable of $100,000 (incurred since the date on which the order for relief was granted) will be paid in the regular course of business. Note payable-First Metropolitan Bank of $215,000 will be settled with an 8 percent, five-year note for $50,500 and 17,700 shares of the stock contributed by the owners. Note payable-Northwestern Bank of Tulsa of $353,000 will be settled with a 7 percent, eight-year note for $103,000 and 17,700 shares of the stock contributed by the owners. b. Prepare a balance sheet for Smith Corporation upon its emergence from reorganization.

Smith Corporation has gone through bankruptcy and is ready to emerge as a reorganized entity on December 31,2020. On this date, the company has the following assets (fair value is based on discounting the anticipated future cash flows): The company has a reorganization value of $828,000. Smith has 52,300 shares of $10 par value common stock outstanding. A deficit Retained Earnings balance of $697.000 also is reported. The owners will distribute 35,400 shares of this stock as part of the reorganization plan. The company's liabilities will be settled as follows: - Accounts payable of $196,000 (existing at the date on which the order for relief was granted) will be settled with an 8 percent, two-year note for $36,000. - Accounts payable of $100,000 (incurred since the date on which the order for relief was granted) will be paid in the regular course of business. - Note payable-First Metropolitan Bank of $215,000 will be settled with an 8 percent, five-year note for $50,500 and 17,700 shares of the stock contributed by the owners. - Note payable-Northwestern Bank of Tulsa of $353,000 will be settled with a 7 percent, eight-year note for $103,000 and 17,700 shares of the stock contributed by the owners. b. Prepare a balance sheet for Smith Corporation upon its emergence from reorganization. b. Prepare a balance sheet for Smith Corporation upon its emergence from reorganization. Smith Corporation has gone through bankruptcy and is ready to emerge as a reorganized entity on December 31,2020. On this date, the company has the following assets (fair value is based on discounting the anticipated future cash flows): The company has a reorganization value of $828,000. Smith has 52,300 shares of $10 par value common stock outstanding. A deficit Retained Earnings balance of $697.000 also is reported. The owners will distribute 35,400 shares of this stock as part of the reorganization plan. The company's liabilities will be settled as follows: - Accounts payable of $196,000 (existing at the date on which the order for relief was granted) will be settled with an 8 percent, two-year note for $36,000. - Accounts payable of $100,000 (incurred since the date on which the order for relief was granted) will be paid in the regular course of business. - Note payable-First Metropolitan Bank of $215,000 will be settled with an 8 percent, five-year note for $50,500 and 17,700 shares of the stock contributed by the owners. - Note payable-Northwestern Bank of Tulsa of $353,000 will be settled with a 7 percent, eight-year note for $103,000 and 17,700 shares of the stock contributed by the owners. b. Prepare a balance sheet for Smith Corporation upon its emergence from reorganization. b. Prepare a balance sheet for Smith Corporation upon its emergence from reorganization