Explore BrainMass

Liquidation- How much creditors and shareholders receive

Tundra Tots is being liquidated under Chapter 7 of the Bankruptcy Act. Its current balance sheet is attached.

Fixed assets are sold for $25,000,000 and current assets are sold for $18,000,000. All fixed assets are pledged as collateral for mortgage bonds. Subordinated debentures are subordinate only to notes payable. Trustee costs are $500,000. No employee is owed over $2,000.


Solution Summary

The solution explains how to calculate the amount that the creditors and shareholders receive in a liquidation