1.

Ranking Of claims
Fully secured
2. Merchandise creditors secured by inventory $ 75,000
4. Holders of mortgage and interest $ 275,000
Total Fully Secured $ 350,000
Unsecured Priority
1. Administrative expense for liquidation $ 10,000
7. Wages payable $4.000 per employee $ 45,000
9. Customer for prepaid merchandise that wasn’t delivered $ 2,000
5. Local government property taxes $ 3,500
$ 6,000
6. State government for gross receipt taxes $ 2,500
Total Unsecured priority claims $ 63,000
Unsecured Non-Priority
3. Merchandise creditor $ 24,000
8. Local bank for principal of loan $ 25,000
8.Interest on unsecured loans $ 5,000
Total Unsecured Non Priority $ 54,000
Total All claims $ 467,000

2. Distribution cash
Cash Available $ 400,000
1st Account payable- secured by inventory $ 75,000
2nd Mortgage holders $ 275,000
3rd Administrative expense $ 10,000
4th Wages payable $ 40,000
Total Distributed $ 400,000
Dan Corporation
Statement Of Affairs
On July 10, 2016
Asset

Book Value

Pledged for fully secured creditors

$ 210,000 Account Receivable
(-) Note Payable
Pledged for partially secured creditors
$ 250,000 Land, Building- Net
(-) Mortage Payable
(-) Interest Payable
Avaiable for priority and unsecured creditors
$ 80,000 Cash
$ 200,000 Inventories
$ 150,000 Equipment- Net
$ 10,000 Intangible Asset
Total Avaiable for priority and unsecured creditors
(-) Priority Liabilities
Total Avaiable for unsecured creditors
Estimated Deficiency
$ 900,000

Liabilities And Equity

Book Value

Fully secured creditors

$ 100,000 Note Payable
(-) Account Receivable

Priority Liabilities
$ 24,000 Wages Payable
$ 76,000 Taxes Payable
$ 50,000 Account Payable (inventory)

Partially Secured
$ 205,000 Mortgage and Interest Payable
(-) Land, Building - Net

Unsecured Creditors
$ 350,000 Account Payable
$ 300,000 Capital Stock
$ (205,000) Retained earning - Deficit
$ 900,000

Priority claims
Administrative expenses
Accounts Payable
Wages Payable
Taxes Payable
Fully secured claims
Note payable
Partially secured claims
Mortgage and interest payable

Unsecured
Accounts Payable

Hitungan
Cash avaiable
(-) Paid Priority Liabilities
(-) Paid Fully secured claims
(-) Paid to partially secured creditors
Cash Avaiable for unsecured
Unsecured Claims
Partially secured (205k-140k)
Accounts Payable- Non prior
Total Unsecured claims

$249000/$415000 = $ 0.6
Asset
Estimated Realizable Estimated Realizable
Value Less Secured Value Avaiable For
Creditor Liabilities Unsecured Creditors

$ 160,000
$ 100,000 $ 100,000 $ 60,000

$ 140,000 $ 65,000
$ 200,000
$ 5,000 $ 205,000 $ -

$ 80,000 $ 350,000
$ 210,000
$ 60,000
$ -
$ 410,000
$ (150,000)
$ 260,000
$ 155,000
$ 415,000

es And Equity

Unsecured Nonpriority
Secured & Priority Claims
Claims

$ 100,000
$ (160,000)
$ (60,000)

$ 24,000
$ 76,000
$ 50,000
$ 150,000

$ 205,000
$ (140,000)
$ 65,000 $ 65,000
 $ 350,000

$ 415,000

Claims By priority
Amount to be paid Amount to be Written Off
ranks

$ 11,000 $ 11,000
$ 50,000 $ 50,000
$ 24,000 $ 24,000
$ 76,000 $ 76,000

$ 100,000 $ 100,000

$ 205,000 $ 140,000 $ 26,000

$ 39,000

$ 350,000 $ 210,000 $ 140,000

$ 816,000 $ 650,000 $ 166,000

$ 650,000
$ (161,000)
$ (100,000)
$ (140,000)
red $ 249,000

$ 65,000
$ 350,000
s $ 415,000