8.

refer to Dremer Corporation Prepare an accounting Statement of Affairs including the computation of
the dividend to Class 7 unsecured creditors.
ANS:
Dremer Corporation
Statement of Affairs
6-1-20X5
Estimated Amt
Estimated Net Avail for Estimated Gain
Book Realizable Unsecured or (Loss)on
Value Assets Value Creditors   Liquidation
Assets pledged with fully secured
creditors:
$ 98,500 Land and Bldg $ 92,800 $22,200 (5,700)
5,800 Investment in Calandir 15,000 4,625 9,200
Total 107,800
Assets pledged with partially secured
creditors:
$ 41,000 Inventory $ 20,000 (21,000)
43,000 Equipment 8,000 (35,000)

Free Assets:
$ 1,850 Cash $ 1,850 $ 1,850 0
21,200 Accounts Rec 17,000 17,000 (4,200)
15,000 Note Rec 15,000 15,000 0

Estimated Amount Avail for unsecured creditors with

and without priority $60,675
Less unsecured creditors with priority (3,775)
Estimated amounts for unsecured creditors without
priority:
Net Realizable Amount Avail $56,900
_______ Deficiency _________ 15,725 _______
$226,350 $169,650 $72,625 $(56,700)

Estimated Estimated Unsecured Amount

Book Liabilities Secured With Without
Value and Owners Equity Amount Priority Priority
Fully Secured Creditors:
$ 600 Accrued Mtg Interest $ 600
70,000 Mortgage Payable 70,000
375 Accrued N/P Interest 375
10,000 Note Payable 10,000
Total $ 80,975

Partially Secured
Creditors:
50,000 Accounts Payable $ 28,000 $22,000

Unsecured Creditors with

Priority:
3,775 Accrued Payroll $ 3,775

Unsecured creditors without

Priority:
40,625 Accounts Payable $40,625
10,000 Other Accrued Liabilities $10,000
$185,375 Totals $108,975 $ 3,775 $72,625

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$ 40,975 Owner Equity
$226,350

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