Problem. The following data are provided by ABC Corp.

which is undergoing liquidation process:

i. Total liabilities amounted to P692,000. 35% of which is fully secured by assets with recorded amount of
P270,000 and an estimated realizable amount of P250,000; 40% of the total liabilities is partially secured
by assets amounting to P300,000 with an estimated realizable amount of P225,000; and the remaining
balance is unsecured.
ii. Total assets amount to P890,000 and has an estimated realizable value of P695,000.
iii. Unpaid income taxes amounts to P35,000. Additional salaries payable and administrative expenses
totaled P28,000.
iv. Deficit amounts to P79,000.

Which of the following statements is correct?

A. The assets available to all unsecured creditors with and without priority is P227,800
B. The estimated payment to partially secured creditors is P225,000
C. The estate deficit amount to P60,000
D. The estimated payment to all secured creditors is P695,000

Problem. The following data were taken from the statement of realization and liquidation of LMN Corp. for the
quarter ended June 30, 2020
Supplementary credits 796,875
Assets to be realized 522,750
Liabilities to be liquidated 948,375
Supplementary charges 731,250
Liabilities liquidated 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

Problem. A review of the assets and liabilities of QRS Corp. in bankruptcy on Nov. 30, 2020, discloses the
following:
i. A mortgage payable of P77,000, is secured by a building with an estimated value in the amount of
P14,000 more than its book value of P68,000
ii. Notes payable of P39,000 is secured by furniture and equipment with book value of P46,000 that is
estimated to be 4/5 realizable.
iii. Assets other than those mentioned above have an estimated realizable value of P25,000, an amount
that is P6,000 more than its book value
iv. Liabilities other than those mentioned above amount to P31,000, which excluded claims with priority
of P8,000

Which of the following statements is correct?

A. Actual recovery percentage is P66.27%
B. Total free assets is P22,000
C. Estimated deficiency to unsecured creditors is P11,200
D. Payment to partially secured creditors amount to 36,800

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Problem. On October 31, 2020, Michael Inc.’s trustee prepares a Statement of Affairs with the following
information:
● P77,000 cash will be received by the unsecured creditors whose claims total P 140,000.
● Raffy the messenger of the company has a claim of P2,625.
● Michael issued to Kerwin a 12%, 1yr note of P17,500 on January 1, 2020, nothing has been pledged to
this note.
● Jan holds a note of P26,250 on which interest of P787.50 is accrued, equipment with book value of
P24,500 has been pledged on this note. Estimated realizable amount of the equipment is P28,875.
● Helen received a 10% note of P21,000 from Michael on Feb.1, 2020, pledged with equipment with an
estimated realizable amount of P17,500.

Which of the following statements is false?

a. Helen will receive P20,291.25
b. Jan will receive P27,037.50
c. Raffy will receive P1,443.75
d. Kerwin will receive P10,587.50

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