The Statement of Affairs for Ivan Corporation shows that approximately P0.78 on the peso probably will be paid to unsecured creditors without priority. The corporation owes JICR Company P23,000 on a promissory note, plus accrued interest on P940. Inventories with a current fair value of P19,200 collateralized the note payable. Compute the amount that JICR Company should receive from Ivan Corporation assuming that the actual payments to unsecured creditors without priority consist of 78% of total claims.

The Statement of Affairs for Ivan Corporation shows that approximately P0.78 on the peso probably will be paid to unsecured creditors without priority. The corporation owes JICR Company P23,000 on a promissory note, plus accrued interest on P940. Inventories with a current fair value of P19,200 collateralized the note payable. Compute the amount that JICR Company should receive from Ivan Corporation assuming that the actual payments to unsecured creditors without priority consist of 78% of total claims.

Financial Management: Theory & Practice

16th Edition

ISBN:9781337909730

Author:Brigham

Publisher:Brigham

Chapter24: Bankruptcy, Reorganization, And Liquidation

Section: Chapter Questions

Problem 1P: Southwestern Wear Inc. has the following balance sheet: The trustees costs total 281,250, and the...

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On January 1, 2019, Park Company accepted a 36,000, non-interest-bearing, 3-year note from a major customer in exchange for used equipment. The equipment had originally cost Park 200,000 and had a book value of 20,000 on the date of the sale. At the 12% imputed interest rate for this type of loan, the present value of the note is 25,500 on January 1, 2019. Park uses the effective interest rate. What is the carrying value of the note receivable on Parks December 31, 2019, balance sheet? a. 28,560 b. 29,000 c. 32,500 d. 36,000
Southwestern Wear Inc. has the following balance sheet: The trustees costs total 281,250, and the firm has no accrued taxes or wages. The debentures are subordinated only to the notes payable. If the firm goes bankrupt and liquidates, how much will each class of investors receive if a total of 2.5 million is received from sale of the assets?
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