The Larisa Company is exiting bankruptcy reorganization with the following accounts: Receivables Inventory Buildings Liabilities Common stock Additional paid-in capital Retained earnings (deficit) Book Value Fair Value $ 81,000 $ 92,000 201,000 212,000 301,000 402,000 301,000 301,000 331,000 22,000 (71,000) The company's assets have a $761,000 reorganization value. As part of the reorganization, the company's owners transferred 70 percent of the outstanding stock to the creditors. Prepare the journal entry (or entries) necessary to adjust the company's records to fresh start accounting. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

The Larisa Company is exiting bankruptcy reorganization with the following accounts: Receivables Inventory Buildings Liabilities Common stock Additional paid-in capital Retained earnings (deficit) Book Value Fair Value $ 81,000 $ 92,000 201,000 212,000 301,000 402,000 301,000 301,000 331,000 22,000 (71,000) The company's assets have a $761,000 reorganization value. As part of the reorganization, the company's owners transferred 70 percent of the outstanding stock to the creditors. Prepare the journal entry (or entries) necessary to adjust the company's records to fresh start accounting. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The Larisa Company is exiting bankruptcy reorganization with the following accounts: Book Value Fair Value Receivables $ 87,000 $ 104,000 Inventory 207,000 224,000 Buildings 307,000 414,000 Liabilities 307,000 307,000 Common stock 337,000 Additional paid-in capital 34,000 Retained earnings (deficit) (77,000 ) The company's assets have a $787,000 reorganization value. As part of the reorganization, the company's owners transferred 70 percent of the outstanding stock to the creditors. Record the entry to reduce additional paid in capital balance to correct figure, to close out gain account, and to eliminate deficit.
The Larisa Company is exiting bankruptcy reorganization with the following accounts: Book Value Fair Value Receivables $ 87,000 $ 104,000 Inventory 207,000 224,000 Buildings 307,000 414,000 Liabilities 307,000 307,000 Common stock 337,000 Additional paid-in capital 34,000 Retained earnings (deficit) (77,000 ) The company's assets have a $787,000 reorganization value. As part of the reorganization, the company's owners transferred 70 percent of the outstanding stock to the creditors. 1) Record the entry to adjust asset values to fair value. 2) Record the entry to reduce additional paid in capital balance to correct figure, to close out gain account, and to eliminate deficit.
The Larisa Company is exiting bankruptcy reorganization with the following accounts: Book Value Fair Value Receivables $ 87,000 $ 104,000 Inventory 207,000 224,000 Buildings 307,000 414,000 Liabilities 307,000 307,000 Common stock 337,000 Additional paid-in capital 34,000 Retained earnings (deficit) (77,000 ) The company's assets have a $787,000 reorganization value. As part of the reorganization, the company's owners transferred 70 percent of the outstanding stock to the creditors. Prepare the journal entry (or entries) necessary to adjust the company’s records to fresh start accounting. Record the entry to reduce additional paid in capital balance to correct figure, to close out gain account, and to eliminate deficit.
The Larisa Company is exiting bankruptcy reorganization with the following account balances: Net Book Value Fair Value Receivables $ 100,000 $ 130,000 Inventory 220,000 250,000 Buildings 320,000 440,000 Liabilities 820,000 820,000 Common stock 150,000 Additional paid-in capital 60,000 Retained earnings (deficit) (390,000) Larisa Company’s assets have a $870,000 reorganization value. As part of the reorganization plan, the company’s owners transferred 80 percent of the outstanding stock to the creditors in exchange for a $500,000 reduction in the liabilities. Required: Prepare the journal entry (or entries) necessary to adjust the company’s records to fresh start accounting. Journal entry worksheet Note: Enter debits before credits. Transaction General Journal Debit Credit 1 these are the differnt lables please…
The Larisa Company is exiting bankruptcy reorganization with the following account balances: Net Book Value Fair Value Receivables $ 80,000 $ 90,000 Inventory 200,000 210,000 Buildings 300,000 400,000 Liabilities 800,000 800,000 Common stock 130,000 Additional paid-in capital 20,000 Retained earnings (deficit) (370,000) Larisa Company’s assets have a $760,000 reorganization value. As part of the reorganization plan, the company’s owners transferred 80 percent of the outstanding stock to the creditors in exchange for a $500,000 reduction in the liabilities. Required: Prepare the journal entry (or entries) necessary to adjust the company’s records to fresh start accounting. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
The Larisa Company is exiting bankruptcy reorganization with the following accounts: Book Value Fair Value Receivables $ 80,000 $ 90,000 Inventory 200,000 210,000 Buildings 300,000 400,000 Liabilities 300,000 300,000 Common stock 330,000 Additional paid-in capital 20,000 Retained earnings (deficit) (70,000 ) The company's assets have a $760,000 reorganization value. As part of the reorganization, the company's owners transferred 80 percent of the outstanding stock to the creditors. Prepare the journal entry that is necessary to adjust the company's records to fresh start accounting. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Entry Options Below Additional paid-in capital Buildings Common stock Goodwill Inventory Liabilities Receivables Retained earnings Make Journal Entry to General Journal
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8 ABC Company filed for a voluntary bankruptcy which was granted after having submitted all the required papers and documents. You are provided the following information as of June 30, 2022: Assets Net Book Value Liquidation Value Cash P 4,997 Investments in equity securities 25,000 P40,000 plus uncollected dividends of P5,000 Accounts receivable, net 54,000 P28,000 expected collection Inventory 75,000 P100,000 after further processing of P10,000 Prepaid expense 8,000 P2,000 is refundable Land 140,000 150% of net book value Building, net 200,000 90% of net book value Equipment 80,000 30% of net book value Goodwill 10,000 Liabilities and Equity Carrying Value Other Information Notes payable P120,000 Secured by inventory Trade and other payables 100,000 Loans payable 350,000 Secured by land and…
The Sunshine Company has the following data in connection with its bankruptcy petition with the Securities and Exchange Commission at the end of 2018. Unsecured creditorsP287.500. Liabilities with priority137,500 Secured Liabilities Debt 1, P262,500; value of pledged asset 225,000 Debt 2, P212,500, value of pledged asset 125,000 Debt 3, P150,000, value of pledged asset 175,000' The company also has a number of other assets that are not pledge in any way, The creditors holding Debt 2 want to receive at least P177,50 Required: For how much do these free assets have to be sold so that Debt 2 would receive exactly P177,500. Show your solution
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