Reference no: EM133180796

Questions -

Q1. During the liquidation, the safe all the assets of liquidated corporation resulted to net proceeds of P1,000,000 Liquidation expense amounting to P60,000 has been paid at the start of liquidation. Before the liquidation, the following date are provided concerning the financial position of the said financial distressed corporation;

The corporation has total assets with book value of P2,000,000 and deficiency amounting to (P340,000)

An investment property with book value of P500,000 and realizable value of P300,000 secured a loan payable amounting to P100,000.

Inventory with book value of P1,000,000 and realizable value of P100,000 secured a note payable amounting to P200,000

Salaries payable and income tax payable amounted to P100,000 and P40,000 respectively.

What is the amount received partially secured creditor?

Q2. When Cruz and Reyes, partners who share earnings equally, were incapacitated in a car accident, an administrator was appointed to wind up the business. The accounts showed Cash, P70,000; Other Assets, P220,000; Liabilities, P40,000; Cruz, Capital, P142,000 and Reyes, Capital, P108,000. Because of highly specialized nature of noncash assets, the liquidator anticipated that considerable time would be required to dispose them. The expenses of liquidating the business (advertising, rent, travel, etc.) are estimated at P20,000.

How much must be realized from the total other assets for Reyes to receive 50% more of his capital balance?