Show the order of priority of payment of debts for Plano Ltd and calculate the amount payable to the company’s trade accounts payable

SWFT Corp Partner Estates Trusts
42nd Edition
ISBN:9780357161548
Author:Raabe
Publisher:Raabe
Chapter7: Corporations: Reorganizations
Section: Chapter Questions
Problem 23P
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  1. Plano Ltd, whose capital consisted of $50000 in fully paid shares, was wound up as a result of a court order. Its liquidator realised $1,343,300 from the sale of the company’s assets. This amount included $340,000 from the proceeds on sale of the company’s land and buildings. Debts proved and admitted were:

 

Unsecured Notes

200000

Debentures (secured by circulating security interest)

600000

First mortgage on land and buildings

200000

Trade accounts payable

160000

PAYG tax instalment

1560

Fringe benefits tax

4000

Directors’ fees

6000

GST

3978

Employees’ holiday pay

10000

Employees’ wages —

8000

Secretary’s salary —

1440

Managing director’s salary —

4800

Sales commission

1000

Liquidation expenses

6000

Second mortgage on land and buildings

160000

Liquidator’s remuneration

16000

 

Required

Show the order of priority of payment of debts for Plano Ltd and calculate the amount payable to the company’s trade accounts payable

  1. Plano Ltd, whose capital consisted of $50000 in fully paid shares, was wound up as a result of a court order. Its liquidator realised $1,343,300 from the sale of the company’s assets. This amount included $340,000 from the proceeds on sale of the company’s land and buildings. Debts proved and admitted were:

 

Unsecured Notes

200000

Debentures (secured by circulating security interest)

600000

First mortgage on land and buildings

200000

Trade accounts payable

160000

PAYG tax instalment

1560

Fringe benefits tax

4000

Directors’ fees

6000

GST

3978

Employees’ holiday pay

10000

Employees’ wages —

8000

Secretary’s salary —

1440

Managing director’s salary —

4800

Sales commission

1000

Liquidation expenses

6000

Second mortgage on land and buildings

160000

Liquidator’s remuneration

16000

 

Required

Show the order of priority of payment of debts for Plano Ltd and calculate the amount payable to the company’s trade accounts payable

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