Olds Company declares Chapter 7 bankruptcy. The following are the asset and liability book values at that time. Administrative expenses are estimated to be $20,000:The holders of note payable B want to collect at least $129,000. To achieve this goal, how much does the company have to receive in the liquidation of its equipment? $ 32,00068,000 (valued at $36,000)78,000 (valued at $64,000)208,000 (valued at $168,000)408,000 (valued at $336,000)128,000 (value unknown)188,000CashAccounts receivable.Inventory..Land (secures note A)..Building (secures bonds).Equipment ...Accounts payable.Taxes payable to governmentNote payable A.Note payable BBonds payable..28,000186,000258,000308,000

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Answered: $ 32,000 68,000 (valued at $36,000)…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Olds Company declares Chapter 7 bankruptcy. The following are the asset and liability book values at that time. Administrative expenses are estimated to be $20,000:

The holders of note payable B want to collect at least $129,000. To achieve this goal, how much does the company have to receive in the liquidation of its equipment?

$ 32,000
68,000 (valued at $36,000)
78,000 (valued at $64,000)
208,000 (valued at $168,000)
408,000 (valued at $336,000)
128,000 (value unknown)
188,000
Cash
Accounts receivable.
Inventory..
Land (secures note A)..
Building (secures bonds).
Equipment ...
Accounts payable.
Taxes payable to government
Note payable A.
Note payable B
Bonds payable..
28,000
186,000
258,000
308,000

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