Shi Company is going through a Chapter 7 bankruptcy. All assets have been liquidated, and the company retains only $26,100 in freecash. The following debts, totaling $42,550, remain:Government claims to unpaid taxesSalary during last month owed to Mr. Key (not an officer)Administrative expensesSalary during last month owed to Ms. Rankin (not an officer)Unsecured accounts payableRequired:Indicate how much money will be paid to the creditor associated with each debt.Types of DebtsAmounts$ 6,90018, 7253,3505,8957,450

Liquidation is the liquidation of a company where all assets of the company are converted into cash…

Answered: hi Company is going through a Chapter 7…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Latex Incorporated is undergoing liquidation. The statement of affairs shows unsecured claims without priority of 3,900,000; partially secured liabilities of 2,800,000; unsecured claims with priority of 264,000 and net free assets of 2,519,000. If unsecured claims without priority received 55% of their claims, how much will the partially secured liabilities receive?
Xavier Company is going through a Chapter 7 bankruptcy. All assets have been liquidated, and the company retains only $26,800 in free cash. The following debts, totaling $46,050, remain: $ 7,600 Government claims to unpaid taxes Salary during last month owed to Mr. Key (not an officer) Administrative expenses 19,425 4,050 Salary during last month owed to Ms. Rankin (not an officer) Unsecured accounts payable 6,825 8,150 Indicate how much money will be paid to the creditor associated with each debt. Types of Debts Amounts
In June of 2018, Mike’s Framing was able to emerge from Chapter11 bankruptcy and then paid James Wholesalers the $375.00 that was previously written off. Prepare the appropriate journal entry for James.
Jaez Corporation is in the process of going through a reorganization. As of December 31, 2017, the company’s accountant has determined the following information although the company is still several months away from emerging from the bankruptcy proceeding. Prepare a balance sheet in the appropriate form.
The following balance sheet has been prepared by the accountant for Limestone Company as of June 3, 2017, the date on which the company is to file a voluntary petition of bankruptcy:Additional Information• If the company is liquidated, administrative expenses are estimated at $18,000.• The accounts payable figure includes $10,000 in wages earned by the company’s 12 employees during May. No one earned more than $2,200.• Liabilities do not include taxes of $14,000 owed to the U.S. government.• Company officials estimate that 40 percent of the accounts receivable will be collected in a liquidation and that the inventory disposal will bring $80,000. The land and buildings will be sold together for approximately $310,000; the equipment should bring $130,000 at auction.Prepare a statement of financial affairs for Limestone Company as of June 3, 2017.
d
A corporation is closing its business on December 31, 2021 due to financial incapacity after being hit by the Covid-19 pandemic. The accountant prepared the necessary documents for the closure such as the Annual Income Tax Return and Audited Annual Financial Statements. In the Audited Annual Financial Statements of the company, there was an ending inventory balance amounting to Php1,250,000.00. What is the tax implication of the ending inventory balance of the company?
Brady is hired in 2021 to be the accountant for Anderson Manufacturing, a private company. At the end of 2021, the balance of Accounts Receivable is $29,000. In the past, Anderson has used only the direct write-off method to account for bad debts. Based on a detailed analysis of amounts owed, Brady believes the best estimate of future bad debts is $9,000. If Anderson continues to use the direct write-off method to account for uncollectible accounts, what adjustment, if any, would Brady record at the end of 2021? What adjustment, if any, would Brady record if Anderson instead uses the allowance method to account for uncollectible accounts?
Miner Company is being forced into bankruptcy. The Company's creditors and stockholders have requested an estimate of the results of liquidation of the Company. Miner's trial balance follows: Accounts Cash Debit Credit P6,000 63,000 Accounts receivable Allowance for bad debts P2,000 Notes receivable 50,000 1,200 Accrued interest on notes receivable Inventory Buildings Accumulated depreciation-Buildings Equipment Accumulated depreciation-Equipment Prepaid insurance 60,000 182,000 63,000 14,600 1,400 1,100 Goodwill 8,500 Accrued wages 6,000 2,400 170,000 80,000 1,600 Taxes payable Accounts payable and other liabilities Notes payable Accrued interest payable Common stock 110,000 Retained earnings (deficit) 50,000 Total P436,400 P436,400 The assets are expected to bring cash on conversion in the following amounts Accounts receivable P50,000 40,800 Notes receivable including P1,000 accrued interest Building 75,000 Prepaid insurance 400
A company going through a Chapter 7 bankruptcy has the following account balances: Cash Receivables (25% collectible) Inventory (worth $34,850) Land (worth $253,000) (secures note payable) Buildings (worth $275,000) (secures bonds payable) Salaries payable (4 workers owed equal amounts for last 2 weeks) Accounts payable Note payable (secured by land) Bonds payable (secured by building) Common stock Retained earnings How much will be paid to each of the following? Answer is complete but not entirely correct. Salaries payable Accounts payable Note payable Bonds payable $ 19,500 $ 41,420 X $ 205,000 $275,000 $ 49,000 69,000 109,000 195,000 390,000 19,500 109,000 205,000 490,000 290,000 (235,000)
Olds Company declares Chapter 7 bankruptcy. Following are the book values of the asset and liability accounts at that time. A bankruptcy expert estimates that administrative expense will total $15,000. Cash Accounts receivable Inventory Land (secures note A) Building (secures bonds) Equipment Accounts payable Taxes payable to government Note payable A Note payable B Bonds payable $ 27,000 63,000 73,000 203,000 403,000 123,000 (value unknown) 183,000 23,000 176,000 253,000 303,000 (valued at $31,000) (valued at $59,000) (valued at $163,000) (valued at $326,000) The holders of note payable B want to collect at least $101,200. Required: To achieve this goal, how much does the company have to receive in the liquidation of its equipment?
Bonita Corporation experienced a fire on December 31, 2022, in which its financial records were partially destroyed. It has been able to salvage some of the records and has ascertained the following balances. December 31, 2022 December 31, 2021 Cash $ 33,500 $ 10,000 Accounts receivable (net) 75,500 130,000 Inventory 194,000 177,000 Accounts payable 51,500 87,000 Notes payable 33,000 58,500 Common stock, $100 par 412.000 412.000 Retained earnings 103,000 100,000 Additional information: 1. The inventory turnover is 2.6 times. 2. The return on common stockholders' equity is 30%. The company had no additional capital accounts. 3. The accounts receivable turnover is 8.7 times. 4. The return on assets is 12.5%. 5. Total assets at December 31, 2021, were $612,000. Compute the following for Bonita Corporation. (a) Cost of goods sold for 2022 $ 482,300 (b) Net credit sales for 2022. $ 893925 (c) Net income for 2022 2$ 154050 (d) Total assets at December 31, 2022 $

SEE MORE QUESTIONS

Recommended textbooks for you

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis…

Accounting

ISBN:

9780134475585

Author:

Srikant M. Datar, Madhav V. Rajan

Publisher:

PEARSON

Intermediate Accounting

Accounting

ISBN:

9781259722660

Author:

J. David Spiceland, Mark W. Nelson, Wayne M Thomas

Publisher:

McGraw-Hill Education

Financial and Managerial Accounting

Accounting

ISBN:

9781259726705

Author:

John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS