Chapter 13 CORPORATE LIQUIDATION mone re pi Sancti cenan led pepe son sa a SSS [mopeic on bell af th eer group The asgnes conver the pope cee anes corner taeeet mo eae ernie eecy eines eosooar ed STATEMENT oF aBEAIRS The sect fas 9 tame of postin ruin eonern po iow sus are pct ter eine ete ve ised big oer ter fuck alee Torhenne, ical of being eld cane onsen ats repre se with cram sri gop te hs shalabie geared. Liniliis are repo their lance ses ‘Bs Ibe ar ose as curet and ronvoeen, bua sed rs tir eal sat or rank ve, as obligation sh piri, secured obligato, tenecrad ec pmeraoigtions. Bs the tect o tars canbe propre ad consructd, a balance shoe is ‘ain sppleneranlrmation i scr ‘ne const ri ‘sassemble. Such supplementary : 4st ad pps fom shat wb alma sei be Sourecs ofthe a-ha yee pe of ets tt ea fons that Fe expect 0 emerge in lor reflected onthe balnge shee ef tha cae suatement of AM cont ecaeation and tHe MeSeHaton of arc up seatepitcaton on the oppose seo he stmt me ses me ediaily classified in group and inthe figs 1. assets pledged with Fly secured reitar ‘These are ase that have sen pl a at ep mnount equal t0.0F in exces ofthe clin winh ty tne Be edged In shor, they are pledged ats whee vlan falthe claims ofthe creditors in gue, 2 Assets pledged with partially secured eens ‘These ae assets that have been pg ha saree tha the amount of the claims om which hy haves pls they are pledged assets whose alu sulin wy He ofthe ereitrs in question, 3. re assets sare ct ht ve wt be ed he indi! ay mse ened ol te it ene on hes st an ae sno whi ean a ale for Be =! en ed erent ab ng reed is ‘ee am ipepe ee sbtes ad Owne | __— Sore tore tne) gay on the Statement of Airs Sas eed ein i el pe (ne stone ffir, ai ese cased according ote on Mts we y omnes a a tons rnormaly clasied in poop ad inthe felony ore nbs wit pry Thee ae prefer cis wbich, by In, be provided fo nl ete Ting maybe pid fo emaningunbecicdcreditor Inst thy se ne {ims ave wht aw, ave ploy oe fe sete nthe han any secured reins ‘Thee me cai whohave been pled cern ats tht exes ‘ald a mucha ar ore than heir respective lis In sh hey Ibis soared ty the pledge of asics Of @ cunt value sais eit pment of tee lami fal Paras secured erediors ‘These acres who have sen lodged cenin ass tht rexel reliefs ban the respetv come In hort fey ae amit eu Uy the pip of ests of a caren lus sii to port» part ‘yet ose clas. Unsecured editors ‘hes a cedton who are without legal pity and ow hve et ‘eed we esses shor. ty ae Ube not sci y th ls {ay esc tnd which have no poly pon fee asses of He Fest irty upon Omer Egy ‘is bln summing he interes of the owes ia i fe repaned wader the heading “Owner equity” or “Sts © sano BPALIZATION AND LQuDstigg a ase of cpeaions of asi ste com Sr eds of alain of aS a hia oS a ste Oy of Spee ep clas a8 hy aa “operations bs tts ae preset ote seme chs “utamee that poets a Summary ofthe nes bee Ie re a eM oc er Fe ceng changes in cash and ina Ny a eo = ora the fom oF alae he. ot une a eeeMULTIPLE CHOICE QUESTIONS PROD. 131 (Adapted) Which the fling et ite te nslvency oF Frm? 12 Thefingebnkptey process agains the fem 1 Ades nibe fiem' etimed aia © Them hs mae than et The om heave wring ap Ron. 12-2(RPCPA) teva oft ledge propery ier hv the bligtion, what ite ‘rein fhe bing Paty ewes 8 Felipsee © Calero, 4 Unecwed PROB. 13.3 (Adare * he pinay diferenc between a fal het and ace itm of last Pe 4 lune sheet ees Bok vale, while sateen ffi ‘emphases shat aloes 7 Asis ar araged in diferent Sequence, ibis arranged in rent sqorce. ‘Omner equi set considered inthe statement of ai, PROB. 134 (Adapted) zone saenent of ffs of & corporation in nancial difcly are ean eet ers wold sng PO onthe pes. Which Rae alow aes motley to realize the smallest percentage 1 Ost 1 Cos ama i eee ian nipment, 5 Gon ja tststtel) advent of 80% allo 1 Ct” ene, 4 ng snterent f ar comely may trams SS Mpenedshine vile gate Sein wilt = & Mesrzrap Gomme cinta § Setter mecnedocoraceess 08.136 (Adapted) an rngement for creditors to acept an mut sth anasto ‘entered foas 9 A Charge and discharge agreemen Composition agrement & Bankrupty agreement. 4 Chandler agreement. 702.137 (Adapted) ‘a linidation proceed siti i secs : ing, ifthe proces on een. ‘Stemi ht eet hxc ait {Bole of the len. a SS Oler en Hodes whos sets wil mt aac «ne thet tens 4 He claims of the unsecured redo ockholdrs ofthe cororion.3 Ligidetion ‘ pce o se 13 cere " co — aicrPad Prom. 1-81 91608) gepny ied & OHI MOLINE Py ye vin unk ds inthe res Hating ay Co airs reflects the following anny te Soe TNT aes ae ie Soe Se andre 0m se moet bag 88 rcele f ee Na bk i of FOS000 ands pining i SRE SLEDS neice ok : Ast 5 nuts pleged wih lly ses hor. P60 pany Mex peceed with partly secs mon 18-9 ers) cdo snaon k «solvate pion AURIS. 2014 ane fesse __ ait seat Libis vane _ ake Lisiies win pice ses Faty sre eeitor, + calus)sedonin P300.000 370000 Parlly secured creditors ‘eds sat ply seed Unared reitors - tna 20000 ‘ame thatthe assets are con aie ar "the business is Tiguidted. Who! tial att ah shad hp ‘wed cers receive? * 6.000 & ao00 © 9.000 * ton.c00 lean sed be * Camel Corp. was forced into bask and Me “own selected arcu nlunces ween 0" 9Assets peg with rts secured Eros Tow fesse Prefered ins Pat seared iabiit 78000 neces smn (3300 2 What i the foal amt salable 6 9m ay enlion? to teed 8 14000 © 1000 4 210000 Whar isthe ested amount of ligne ide “ (roanded othe eae on Seeger maaan wo 84 wa tein ha ey cng vk vee 24 er To cpl ae nal ie ae ok isn cero ete ence il poy le pe 00 Btn thal ann MeO ceo a rob ww be wna ince ha ee tote os enucd ces m4 Wolo he erates ee So 50,000, & 35000 ©3000, oo PROB. 13-13 (Adapted) Tie flowing simsed account ances were he tom be Bane she oF Guitine Corp. as of December 3, 2013, esa beret Markeable sure 40.000 Inventiones How and "si. Building 00.00 Adsiona information: + Marketable secures fave present market value of 920000, Thess {ure ave been pledged 0200 oes paale of P20,000, Let ae meas ea ac tien et ne Cassar Or pe evra roan : Se cece Laka ig ea ate| What ite enimate amount avilable for prefered lai nton outof met pecbed wih ally secured reditors” 8 “ 1 What isthe otal amount of mele ase? &s10.000 & 7000 © M000 42000 PROB. 13-14 Adapted) ‘The aswuntnt of Dring Crp. prepared statnent oF aft there are no elas © liens are expected 0 praduse P7OOAWO. Unsere ‘Jaime ofall clases ttafed to PLOSUc00. The following dat ae cans rome cutuning 1. Acct salaries PIS.000 2 Unecrde note for 70,000 on which F600 of interest has acrid hey ‘Nommandy Co. 3. A note for P30,000 secured by PA0,000 recsivable, estimated to be 60% collectible eld by fnes Co, 4. A PIS,000 ace, on which P300 interest has accrued held hy James ry. Property with a book value of P10,000 and a market value of PI,000 i edged to garcte pment of principal and interest 5. Unpaid income xe of 35,000, ‘Whats th amount elized by parlly secured creditors? 104600 1900 © 24900, 4. 27900 iguldeion g pws AND EXPLANATIONS 1085 sted answer () The frm has mere as we i ha en oti fea, 4 i ech sn xe pes ficult fen oe ene ers engl er parte encore ed answer (a) Partially secured on eget ane (0) Pay. pay secured Tails ore cline where ces he hey Farnasset hat are expected 0 reali ls ta hereon ropes Suggested answer (a) A Balance she fc bower wea eS eee statement of afiarsenpss issin vals. soln shee sa statement of fc onion sn vy eri acne tooo ccd picts ce se Trewern condon of ins fom se presen ca reaction ale of ec snd ie Whites ofthe bse stent 8 comer point of lew "MOB.134 Suggested answer (d) Goodwill exes fs 45 dened, goodwill i the present valve of ee) normal rate of return. ‘Tes likely to have no rel le Sin financial digit 4 S