Chapter 2
Chapter 2
Chapter 2
1.4. How much is the estimated recovery percentage to the partially secured
accounts payable?
a. 97.29% b. 95.85% c. 96.28% d. 96.86%
Deficit (1,700,000)
The note payable is secured by the inventory with net realizable value of
P 250,000.
The mortgage payable is secured by the land with fair value of P 120,000.
2.1. What is the amount received by the holder of the note payable at the end
of corporate liquidation?
a. 320,000 b. 300,000 c. 250,000 d. 260,000
2.2. What is the amount received by the holder of the mortgage payable at the
end of corporate liquidation?
a. 120,000 b. 200,000 c. 150,000 d. 100,000
2.3. What is the amount received by the employees at the end of corporate
liquidation concerning their salaries?
a. 100,000 b. 120,000 c. 72,000 d. 300,000
3.1. How much is the profit or loss in the statement of realization and
liquidation?
a. (42,475) b. 27,975 c. (77,675) d. 75,175
4. Finish Corp. has been undergoing liquidation since January 1. Its condensed
statement of realization and liquidation for the month of June is presented
below:
Interest received in cash on investment 10,500
Purchases on account 105,000
Liabilities liquidated 2,450,000
Assets realized 2,100,000
Payment of expenses of trustee 525,000
Liabilities to be liquidated 4,574,500
Sales on account 50,000
Assets to be realized 2,940,000
Liabilities not liquidated 2,229,500
Sales for cash 1,750,000
Assets not realized 6,650,000
What is the net gain (loss) on realization and liquidation?
a. 1,225,000 b. (479,500) c. (1,225,000) d. 479,500