Question

Quincy Corp., about to be liquidated, has the following amounts for its assets and liabilities:

				Net
		Book		Realizable
		Value		Value
Current assets	$	200,000	$	140,000
Land		70,000		100,000
Building		500,000		350,000
Equipment		300,000		160,000
Accounts payable		240,000
Income taxes payable		60,000
Mortgage payable		510,000
Note payable		80,000

The mortgage is secured by the land and building, and the note payable is secured by the equipment. Quincy expects that the expenses of administering the liquidation will total $40,000.

How much should Quincy expect to pay on the accounts payable?

Multiple Choice

• $128,000.

• $120,000.

• $146,000.

• $ 96,000.

• $240,000.

Answer 1

crivew, montag mantgage is secured by Land & Building and notes payable is secured by Equipment. --> Therepoe land of building value iş = 109000+ 3,50,000 - 4,50,000 but mortgage paupble is = 5,10,000. Therepre un secured mortgage payable is - 5,10,000 - 4,50,000 - 60,000. Equipment value is = 1,60,000 note payable = 80,000 Therefore amount available is = 1,60,000 - 89000 Jadi pri e 19000. 1 = so that - total amount anailable is current assets value & equipment value after ndes payable 1,40,000 + 89000 2,20,000

from have and the total amount available, we to first pay in come tomes payable liquidation Eupanses. Gronat tole 1 1,20,000 =) total amount available = 2,20,000 E) Liquidation Empenses - (40,000) 6) income taxes payable - (60,000) Dement avec table to 1,9900 Therefore amount available for accounts payable and unsecured mortgage payables = 1,20000 but accante payable amount = 240,000 unsecured martgage payables - 60,000 Total 3,00,000. calculation of amount payable to accounts payable $ 1,20,000 available fyr ->$300,000 1? 6$2,49000 2,49000 X 1,20,000 300,000 - # 96,000