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Corporate Liquidation
Corporate Liquidation
Problem 1.
The Global Corporation is undergoing liquidation and has the following condensed
statement of financial position as of January 1, 2013:
ASSETS LIABILITIES AND SHE
Cash P114,200 Salaries Payable P50,000
Receivables, net 340,800 Accounts Payable 108,500
Inventory 80,000 Mortgage Payable 400,000
Prepaid expenses 2,500 Loan Payable 220,000
Building (net) 345,000 Note Payable 80,000
Goodwill 55,000 Ordinary shares 120,000
Deficit (41,000)
Total Assets P 937,500 P 937,500
Problem 4.
Twisted Corporation is undergoing liquidation. The trustee of Twisted Corp.
presented the following information: Assets amounting to P125,000 are available to
unsecured liabilities without priority. Assets amounting to P110,000 represents
assets originally not pledged to any liabilities. Unpaid liabilities are as follows:
administrative expenses, P21,000; taxes, P18,000 and wages, P32,000. Accounts
payable and notes payable totalled P180,000. No assets were pledged on the said
liabilities. Payment to fully secured creditors and partially secured creditors amounts
to P139,000 and P144,000 respectively. The expected recovery percentage is 40
percent.
Amount of assets pledged to fully secured creditors
A. P139,000
B. P225,000
C. P235,000
D. P249,000
Total liabilities
A. P522,500
B. P534,000
C. P613,500
D. P580,000
The amount to be paid to all creditors
A. P426,000
B. P187,500
C. P479,000
D. P210,000
Problem 5.
The following data were taken from the statement of realization and liquidation of
intercontinental Corporation for the quarter ended June 30, 2013
Assets to be realized P515,625
Supplementary credits 796,875
Liabilities to be liquidated 843,750
Supplementary charges 731,250
Liabilities liquidated 562,500
Assets acquired 562,500
Assets realized 656,250
Liabilities assumed 281,250
Assets not realized 234,375
The ending capital balances of capital stock and retained earnings are P648,750 and
P178,500, respectively. A net loss of P226,500 for the period.
How much is the ending balance of cash?
A. P1,125,000
B. P1,260,000
C. P978,750
D. P807,000
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