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Yellaratu Group is reorganizing and has presented a proposal based on a going - concern value of $ 3 million after reorganization costs and delinquent

Yellaratu Group is reorganizing and has presented a proposal based on a going-concern value of $3 million after reorganization costs and delinquent wages, benefits, and taxes. The proposed financial structure is $680,000 in new mortgage debt, $320,000 in subordinated debt, and $2,000,000 in new equity. Secured creditors currently have a mortgage lien for $2.5 million on the factory and the unsecured creditors claims total $1.3 million. How much of the new debt and equity securities should the secured creditors receive?
Multiple Choice
$3.0 million
$.68 million
$2.5 million
$1.8 million
$3.0 million

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