CORPORATE LIQUIDATION & REORGANIZATION

- most common reason is insolvency (liabilities exceed assets), thereby resulting to financial dificulty in paying off
debts.

INSOLVENCY ACT OF THE PHILIPPINES

A. Voluntary - the insolvent corporation voluntarily applies a petition to a court of law to be discharged from its
liabilities.
B. Involuntary - three or more creditors of the insolvent corporation file a petition to a court of law for the
adjudication of the corporation as insolvent.

LIQUIDATION- termination of business operations or the winding up affairs.

*Non cash assets realized to cash.
*Liabilities are paid.
*Remaining assets to owners.

APPROPRIATE MEASUREMENT
ASSETS --> REALIZABLE VALUE (ESTIMATED SELLING PRICE LESS DISPOSABLE COSTS)
LIABILITIES --> EXPECTED NET SETTLEMENT

FINANCIAL REPORTS
1. STATEMENT OF AFFAIRS
2. STATEMENT OF REALIZATION AND LIQUIDATION
*NOTE DISCLOSURES AND SUMMARY OF CASH RECEIPTS & DISBURSEMENTS may also be prepared.

STATEMENT OF AFFAIRS (same as Financial Position)

ASSETS:
1. Pledged to Fully Secured Creditors - assets with realizable values equal to or greater than the expected net
settlement amounts of the related liabilities for which the assets have been pledged as security. The excess is
available to unsecured creditors.
2. Pledged to Partially Secured Creditors - assets with realizable values less than the expected net settlement
amounts of the related liabilities for which the assets have been pledged as security. The deficiency must come
from the proceeds of other assets.
3. Free Assets - not been pledged and includes also excess of pledged to fully secured creditors.

LIABILITIES:
1. Unsecured Liabilities with Priority - mandated by law to be paid first.
A. Administrative expenses - direct costs
B. Salaries and other benefits
C. Taxes and assessments
2. Fully Secured Creditors - liabilities secured with sufficient assets.
3. Partially Secured Creditors - liabilities secured with insufficient assets.
4. Unsecured Liabilities without Priority - all other liabilities not classified under (1), (2), and (3) above.

STEPS:
1. Restate the assets and liabilities.
2. Identify the classifications of the assets and liabilities.
3. (Optional) Estimated Recovery Percentage (ERP)
ERP of Unsecured Creditors without priority = Net Free Assets/Total Unsecured Liabilties w/o Priority

STATEMENT OF REALIZATION AND LIQUIDATION - periodic financial report that shows information on the progress
of the liquidation process. It is depicted like a T-account.

Debits Credits
*Assets to be realized *Assets realized
*Assets acquired *Assets not realized
*Liabilities Liquidated *Liabilities to be liquidated
*Liabilities not liquidated *Liabilities assumed
*Supplementary expenses *Supplementary income

NOTE:
>Excess of Credits over Debits is Net Gain.
>Excess of Debits over Credits is Net Loss.

*Assets to be realized - represents the total non-cash assets available for disposal as at the beginning of the period.
This is measured at book value (carrying amount).
*Assets acquired - represents previously unrecorded assets that were recognized during the period. Similar terms
are "additional assets" or "new assets".
*Assets realized - represents the actual net proceeds from the conversion of non-cash assets into cash during the
period.
*Assets not realized - the unsold non-cash assets as at the end of the period, measured at book value.
*Liabilities to be liquidated - represents the total liabilities to be settled as at the beginning of the period. This is
measured at book value.
*Liabilities assumed - represents previously unrecorded liabilities that were recognized during the period. Similar
terms are "Additional liabilities" or "new liabilities".
*Liabilities liquidated - represents the actual net settlement amounts of liabilities paid during the period.
*Liabilities not liquidated - unpaid liabilities as at the end of the period, measured at book value.
*Supplementary expenses/income - income and expenses realized/incurred during the period.

REORGANIZATION - implementation of a business plan to restructure or rehabilitate a corporation with the hopes
of increasing company value. Insolvency is one of the reasons of reorganization.
Types:
1. Group reorganization - ownership within a group of companies changes.
2. Recapitalization - refers to the change in capital structure through the replacement of old shares with new
shares.
3. Quasi-reorganization - revalues its assets and liabilities and realigns its equity.
4. Corporate rehabilitation - administered by another party in order to try to bring back the corporation to its
former financial condition.
5. Troubled debt restructuring - involves the settlement of obligation at other than the originally agreed method of
settlement. The creditor grants the debtor concession.

STRAIGHT PROBLEMS:

The following balances were ascertained in NO MONEY Corp. which is experiencing insolvency:
Cash 8,000 Accounts payable 80,000
Note receivable 120,000 Accrued expenses 30,000
Inventories 80,000 Salaries payable 15,000
Prepaid expense 10,000 Mortgage payable 155,000
Equipment, net 150,000 Ordinary shares 100,000
TOTAL 368,000 Deficit (12,000)
TOTAL 368,000
Additional information:
*Estimated net realizable value of the notes receivable was P105,000 and was pledged to the mortgage payable.
*80% of the book value of the inventories can be sold at P45,000 and was pledged to 60% of the accounts payable.
*The remaining book value of the inventories have an estimated fair value of P20,000.
*80% of the remaining unpaid accounts payable were secured by the equipment having an estimated fair value of
P60,000.
*Prepaid expense has no estimated fair value.
*Liquidation and administration expenses were estimated in the amount of P8,000.
*Income tax payable had been accrued in the amount of P2,000 (the accountant recorded it using the accrued
expense account)
*Interest on the note receivable and mortgage payable have not been accrued in the amount of P10,000 and
P15,000 respectively.

Requirements:
1. How much is the estimated deficiency?
55,000 Cash 8,000
Inventories 20,000
Equipment 34,400
Total Free Assets 62,400
Less: UC with Priority 25,000
Net Free Assets P37,400
UC w/o Priority Inc. of UP of PSL 92,400
Deficiency (SHE) Debit balance 55,000
2. How much are the net free assets?
37,400
3. How much is the estimated payment to the mortgage payable?
137,264 Mortgage Payable 155,000
Interest Payable 15,000 170,000
NRV of Note Receivable 105,000
Interest Note Receivable 10,000 (115,000)
UP OF PSL (MP + IP) 55,000

UP of PSL (MP + IP) 55,000

NRV of NR and Interest on NR 115,000
ADD: RECOVERY FROM UP OF PSC(55K x 40.476) 22,261.8
137,264

UNSECURED CREDITS W/O PRIORITY

Unsecured AP (80,000 x 40%) x 20% = P6,400
Unsecured AE W/O Priority (30,000-2,000) =28,000
UP of PSL: (MP + IP) =55,000
UP of PSL (AP) =3,000
UC w/o Priority Inc. of UP of PSL 92,400
RECOVERY RATE OF UC W/O PRIORITY = 37,400/92,400 = 40.476%

4. How much is the estimated recovery percentage to the partially secured accounts payable?
96.28%

UC w/ PRIORITY FSL
LIQ. EXP 8,000 SECURED AP
SALARIES PAYABLE 15,000 (80,000 X 40%) X80% 25,600
ITP 2,000 FV OF EQUIPMENT 60,000
UC W/ PRIORITY 25,000 FREE EQUIP 34,400

PSL
SECURED AP (80,000 X 60%) 48,000
 NRV OF INVENTORY 45,000
UP OF PSL (AP) (3,000)
NRV OF INVENTORY 45,000
(3,000 X 40.476%) 1214.28
46,214.28/48,000= 96.28%

ABC Co.'s statement of realization and liquidation shows the following:

ASSETS:
To be realized 2,000,000
Acquired 15,000
Realized 1,180,000
Not realized 220,000

LIABILITIES:
Liquidated 2,130,000
Not liquidated 1,190,000
To be liquidated 2,870,000
Assumed 32,000

SUPPLEMENTARY ITEMS:
Supplementary expenses 25,000
Supplementary income 18,000
Requirements:
1. How much is the net gain (loss) for the period?
Debits Credits
*Assets to be realized 2,000,000 *Assets realized 1,180,000
*Assets acquired 15,000 *Assets not realized 220,000
*Liabilities Liquidated 2,130,000 *Liabilities to be liquidated 2,870,000
*Liabilities not liquidated 1,190,000 *Liabilities assumed 32,000
*Supplementary expenses 25,000 *Supplementary income 18,000
TOTAL 5,360,000 4,320,000
Net Loss- excess of Dr. over Cr. 1,040,000

2. If the estate deficit at the end of the period is P870,000, how much is the ending balance of cash?
ASSETS = LIABILITIES + EQUITY
Cash (squeeze) 100,000 Liabilities not liquidated 1,190,000 (start from here)
Assets not realized 220,000 Estate Deficit (870,000)
Total 320,000 Total 320,000

MULTIPLE CHOICE (THEORIES):

1. It refers to the extinguishment of the juridical personality of a corporation for causes expressly provided by law.
A. Corporate liquidation
B. Corporate dissolution
C. Corporate rehabilitation
D. Corporate termination

2. It refers to process of winding up the affairs of the corporation by settling its corporate debts and distributing the
remainder to the stockholders.
A. Corporate liquidation
B. Corporate dissolution
C. Corporate rehabilitation
D. Corporate termination
3. After the date of corporate dissolution, what is the maximum period allowed by law to a dissolved corporation to
complete its liquidation process?
A. 1 year C. 3 years
B. 2 years D. 4 years

4. Which of the following best illustrates the insolvency of a firm?

a. The filing of bankruptcy proceedings against the firm.
b. A deficit in the firm's retained earnings.
c. The firm has more liabilities than assets.
d. The firm has negative working capital.

5. Which of the following is not a general objective of bankruptcy procedures?

A. attempt to give the debtor a fresh start
B. assurance that all obligations of the debtor will be satisfied completely
C. assurance of an equitable distribution of the debtor's property among creditors
D. None of the above is a general objective.

6. It is the initial report prepared at the start of the liquidating process.

a. statement of love affairs
b. statement of break up
c. cooling-off statement
d. statement of affairs

7. A special-purpose statement prepared to show financial condition of an insolvent business is the

a. Charge & Discharge Account
b. Deficiency Statement
c. Realization & Liquidation Account
d. Statement of Affairs

8. In the accounting statement of affairs, the gains or losses upon liquidation would equal
A. net book value of assets minus book value of liabilities.
B. the book value of assets minus their realizable value.
C. total estimated realizable value of assets minus the amount assigned to secured creditors.
D. total estimated realizable value of assets minus the amount remaining for Class 7 unsecured creditors.

9. A corporation's accounting statement of affairs shows a dividend of 115%. The dividend means that
A. an error was made in the preparation of the statement.
B. stockholders may expect some return on their interests.
C. secured creditors will receive an amount in excess of the book value of their claims.
D. unsecured creditors will receive an amount in excess of the book value of their claims.

10. The primary difference between a balance sheet and an accounting statement of affairs is that:
a. A balance sheet reflects book values, while a statement of affairs emphasizes realization values.
b. Assets are arranged in a different sequence.
c. Liabilities are arranged in a different sequence.
d. Owners' equity is not considered in the statement of affairs.

11. If the value of the pledged property is lesser than the obligation, what is the treatment of the liability?
a. Partially secured.
b. Fully secured.
c. Collateralized.
d. Unsecured.

12. In a liquidation proceeding, if the proceeds on the realization of an asset exceed the lien against that asset, the
excess is assigned to
a. The holder of the lien.
b. Other lien holders whose assets will not realize a sufficient amount to cover their liens.
c. Meet the claims of the unsecured creditors.
d. The stockholders of the corporation.

13. Which of the following statements is correct?

a. involuntary insolvency occurs when the insolvent corporation voluntarily applies, by petition to a court of
law, to be discharged from its liabilities.
b. Voluntary insolvency occurs when three or more creditors of the insolvent corporation file a petition to a
court of law for the adjudication of the corporation as insolvent.
c. The Conceptual Framework and the PFRSs apply to entities undergoing liquidation.
d. The measurement bases under the Conceptual Framework and the PFRSs are not applicable to liquidating
entities.

14. Which of the following is not considered an unsecured liability with priority?
a. Administrative expenses
b. Unpaid employee salaries and other benefits
c. Liability with collateral security
d. Taxes and assessments

15. The estimated deficiency to unsecured creditors without priority is computed as

a. net free assets less total unsecured liabilities without priority
b. net free assets divided by total unsecured liabilities without priority
c. total assets at realizable value less total liabilities at realizable value
d. a or c

MULTIPLE CHOICE (PROBLEMS):

The next questions are based on the following information:

Quitter Co. is undergoing liquidation. Relevant information follows:

Carrying Realizable
amount value
Assets pledged with partially secured creditors 80,000 50,000
Free assets 220,000 160,000

Expected
settlement
amount Amount unsecured
Liabilities with priority 16,000
Partially secured creditors 75,000 25,000
Unsecured creditors 155,000 155,000

1. What is the total amount available for payment of claims of unsecured, creditors?
a. 210,000
b. 160,000
c. 144,000
d. 0
> Available for unsecured creditors
Free assets 160,000
Liabilities with priority (16,000)
Net free assets 144,000

2. What is the estimated amount of liquidating dividend per peso claim?

a. 1.17
b. 1.03
c. 0.88
d. 0.80

Unsecured portion of partially secured creditors 25,000

Unsecured creditors 155,000
Total unsecured liabilities without priority 180,000

Net free assets 144,000

Divide by: Total unsecured liabilities without priority 180,000
Recovery per peso 0.80

3. What is the amount of deficiency to creditors?

a. 36,000
b. 144,000
c. 160,000
d. 180,000

Assets pledged with partially secured creditors 50,000

Free assets 160,000
Liabilities with priority (16,000)
Partially secured creditors (75,000)
Unsecured creditors (155,000)
Deficiency (36,000)

4. The following data were taken from the statement of affairs for Liquo Company:

Assets pledged for fully secured liabilities

(fair value, P75.000). P90,000
Assets pledged to partially secured liabilities
(fair value, P52,000) 74,000
Free assets (fair value, P40,000) 70,000
Unsecured liabilities with priority 7,000
Fully secured liabilities 30,000
Partially secured liabilities 60,000
Unsecured liabilities without priority 112,000

Compute the: (1) total estimated deficiency to unsecured creditors, and (2) the expected recovery per peso of
unsecured claims.

a. (1) P42,000; (2) P.65 c. (1) P -0-; (2) P1.00

b. (1) P3,000; (2) P.98 d. (1) P42,000; (2) P.70

Bang Co . is undergoing liquidation. Relevant information follows:

 Carrying amount
Accounts receivable 300,000
Inventories 110,000
Land 150,000
Building 400,000

The accounts receivable has a realizable value of P320,000. The accounts receivable has been pledged to secure
notes payable with an expected settlement amount of P280.000.
The inventories have a total realizable value of P70,000. Included in the inventories are inventories with carrying
amount of P50,000 and realizable value of P60,000 which have been pledged to secure an account payable with an
estimated settlement amount of P40,000.
The land and building have a total realizable value of P450.000. Both assets have been used as collateral security
for a bank loan of P250.000.

5. What is the estimated amount available for preferred claims and unsecured creditors out of assets pledged with
fully secured creditors?
a. 200,000
b. 240,000
c. 270,000
d. 320,000

Assets pledged to fully Realizable Available for

secured creditors: value unsecured creditors
Accounts receivable 320,000
Notes payable (280,000) 40,000
Land and building 450,000
Bank loan (250,000) 200,000
Estimated amount out of assets pledged with fully secured creditors 240,000

6. What is the total amount of net free assets?

a. 200,000
b. 240,000
c. 270,000
d. 320,000

Assets pledged to fully Realizable Available for

secured creditors: value unsecured creditors
Accounts receivable 320,000
Notes payable (280,000) 40,000
Land and building 450,000
Bank loan (250,000) 200,000
Inventories 70,000
Inventories pledged to partially
secured creditors (40,000) 30,000
Net free assets 270,000

7. The First Family Bank loaned P4,000,000 to Belle Corporation. The loan is secured by a land with a book value
and fair market value of P5,000,000 and P3,000,000, respectively. What amount will the bank received if unsecured
creditors received 25% of their claims?
a. P1,000,000
b. P3,000,000
c. P3,250,000
d. P4,000,000
Fully secured P 3,000,000
Unsecured claim (PI,000,000 x 25%) 250,000
Amount received by the bank P3,250,000

8. When the Insolvent Company filed for bankruptcy, it prepared the following balance sheet:
Current assets (net realizable value P500,000) P 800,000
Land and building (fair market value P2,400,000) 2,000,000
Goodwill 400,000
P3,200,000
Accounts payable (unsecured) P1,600,000
Mortgage payable (secured by land and building) 2,000,000
Common stock 1,000,000
Retained earnings (deficit) ( 1,400,000)
P3,200,000
What percentage of their claims will the unsecured creditors likely to get?
a. 43.75%
b. 50%
c. 56.25%
d. 100%

Current assets at realizable value 500,000

Land and building at fair value 2,400,000
Less: Mortgage payable Total realizable value 2,000,000 400,000
Divided by accounts payable 1,600,000
Percentage of claims of unsecured creditors 56.25%

9. Sayap Company signed a note payable to its bank for P2,000,000. Accrued interest on the note on February 29,
2008 amounts to P50,000. The note is secured by inventory with a book value of P2,300,000. The inventory is sold
for P1,600,000 and unsecured creditors receive 30% of their claims. What amount should the bank receive in
settlement of the note and interest?
a. P2,050,000
b. P2,000,000
c. P1,705,000
d. P1,600,000

Proceeds for inventory 1,600,000

Unsecured note balance and interest at 30% 105,000
[(P300,000 + P50,000) x 30%]
Payment to Bank ,705,000

10. The following data were taken from the statement of realization and liquidation of Bagsak Corporation for the
three month period ended December 31, 2013:
Assets to be realized P55,000
Assets acquired 60,000
Assets realized 70,000
Assets not realized 25,000
Liabilities to be liquidated 90,000
Liabilities assumed 30,000
Liabilities liquidated 60,000
Liabilities not liquidated 75,000
Supplementary credits 85,000
Supplementary charges 78,000
What is the net income (loss) for the period?
a. P28,090
b. P(28,000)
c. P(35,000)
d. P7,000

Debits:
Assets to be realized P55,000
Assets acquired 60,000
Liabilities not liquidated 75,000
Liabilities liquidated 60,000
Supplementary charges 78,000 P328,000
Credits:
Assets realized P70,000
Assets not realized 25,000
Liabilities to be liquidated 30,000
Supplementary credits 85,000 300,000
Net loss P28,000

11. A statement of realization and liquidation has been prepared. Totals therefrom are as follows:
Assets to be realized P80,000
Assets acquired 40,000
Assets realized 30,000
Assets not realized 90,000
Liabilities to be liquidated 80,000
Liabilities assumed 50,000
Liabilities liquidated 100,000
Liabilities not liquidated 30,000
Supplementary credits 110,000
Supplementary charges 98,000
The ending balances of capital stock and retained earnings are P100,000 and P18,00 respectively.
How much was the ending balance of cash?
a. P35,000
b. P45,000
c. P58,000
d. P59,000

Capital stock PI 00,000

Retained earnings 18,000
Liabilities not liquidated 30,000
Total assets P 148,000
Less: Assets not realized 90,000
Cash balance, end P 58,000

Quizzer:

1. Assets in the statement of affairs are classified into

a. Assets pledged to fully secured creditors
b. Assets pledged to partially secured creditors
c. Free assets.
d. All of these
2. These are assets with realizable values less than the realizable values of the related liabilities for which these
assets have been pledged as security.
a. Assets pledged to fully secured creditors
b. Assets pledged to partially secured creditors
c. Free assets.
d. All of these

3. These are assets that have not been pledged as security of liabilities. These also include the excess of realizable
values of assets pledged to fully secured creditors over the realizable values of related liabilities for which these
assets have been pledged.
a. Assets pledged to fully secured creditors
b. Assets pledged to partially secured creditors
c. Free assets
d. All of these

4. The total unsecured liabilities without priority can be computed as

a. Unsecured creditors without priority plus deficiency of assets pledged to partially secured creditors
b. Unsecured creditors without priority less estimated realizable value of assets pledged to partially secured
creditors
c. Sum of administrative expenses, unpaid employee salaries and benefits, and taxes and assessments.
d. Total liabilities less priority claims.

5. The estimated recovery of partially secured creditors is equal to

a. the realizable value of the assets pledged plus the excess amount multiplied by the estimated recovery
percentage.
b. the realizable value of the assets pledged minus the excess amount multiplied by the estimated recovery
percentage.
c. their claims multiplied by the estimated recovery percentage.
d. any of these

6. It is a financial report which shows information on the progress of the liquidation process.
a. statement of affairs
b. statement of liquidating affairs
c. statement of realization and liquidation
d. statement of changes in net assets

7. If the total debits in the statement of realization and liquidation exceeds the total credits, there is
a. net gain for the period
b. net loss for the period
c. either a or b
d. none of these

8. "Assets to be realized” is placed on which side of a statement of realization and liquidation?

a. debit side, measured at realizable value
b. credit side, measured at book value
c. debit side, measured at book value
d. no side

9. “Liabilities not liquidated” is placed on which side of a statement of realization and liquidation?
a. debit side, measured at realizable value
b. credit side, measured at book value
c. debit side, measured at book value
d. no side

10. It refers to the implementation of a business plan to restructure or rehabilitate a corporation with the hopes of
increasing company value. In most cases, it involves changing the entity’s capital structure.
a. transformation
c. reorganization
b. mutation
d. translation

11. Which of the following does not describe the accounting statement of affairs?
A. the statement can also be used in a reorganization
B. the emphasis is on asset net realizable value, not historical cost
C. the statement of affairs is concerned only with the assets of the debtor organization, not the claims
D. the statement of affairs is based on estimated values; actual realized values may be different

12. An arrangement for creditors to accept an amount less than the amount owed to them is referred to as a
a. Charge and discharge agreement.
b. Composition agreement.
c. Bankruptcy agreement.
d. Chandler agreement.

Zero Na Corp. has been undergoing liquidation since January 1. As of March 31, its condensed statement of
realization and liquidation is presented below:

Assets:
Assets to be realized P1,375,000
Assets acquired 750,000
Assets realized 1,200.000
Assets not realized 1,375,000
Liabilities:
Liabilities liquidated P1,875,000
Liabilities not liquidated 1,700,000
Liabilities to be liquidated 2,250,000
Liabilities assumed 1,625,000
Revenues and Expenses:
Supplementary charges P3,125,000
Supplementary credits 2,800,000

13. The net gain (loss) for the three-month period ending March 31 is:
a. P250,000 c. P425,000
b. (325,000) d. 750,000

14. Using the same information on No. 19, compute the ending cash balance of cash account assuming that
common stock and deficits are P1,500,000 and P500,000, respectively.
a. P425,000 c. P1,325,000
b. P575,000 d. P1,375,000

The Palubog Company has decided to seek liquidation after previous restructuring and quasi-reorganization
attempts failed. The company has the following condensed balance sheet as of May 1,2011:
Assets Liabilities and Stockholders' Equity
Cash P12,000 Accrued payroll P 40,000
Receivables (net) 280,000 Loans from officer 50,000
Inventory 70,000 Accounts payable 60,000
Prepaid expenses 1,000 Equipment loan payable 360,000
Plant assets 300,000 Business loan payable 180,000
Goodwill 39,000 Common stock 60,000
_______ Deficit (48,000)
Total P702,000 Total P702,000

The equipment loan payable is secured by specific plant assets having a book value of P300,000 and a realizable
value of P350,000. Of the accounts payable, P40,000 is secured by inventory which has a cost of P40,000 and a
liquidation value of P44,000. The balance of the inventory has a realizable value of P32,000. Receivables with a
book value and market value of P100,000 and P80,000 respectively have been pledged as collateral on the business
loan payable. The balance of the receivables have a realizable value of P150,000.

15. Assuming trustee expenses of P12,000 in addition to recorded liabilities, which of the remaining unsecured
creditors has the next highest order of priority.
a. Accrued payroll c. Loan from officer
b. Equipment loan payable d. Business loan payable

16. The realizable value of assets pledged with fully secured creditors is:
a. P459,000 c. P40,000
b. 44,000 d. 489,000

17. Of those creditors who are partially secured, their unsecured amounts are:
a. P430,000 c. P540,000
b. 110,000 d. 120,000

18. The total realizable value of free assets to unsecured creditors before unsecured creditors with priority is:
a. P628,000 c. P220,000
b. 232,000 d. 198,000

19. The dividend to unsecured creditors or the expected recovery percentage of unsecured creditors (rounded) is:
a. 90% c. 88%
b. 100% d. 76%

20. Estimated deficiency to unsecured creditors is:

a. P-0- c. P2,000
b. 22,000 d. 12,000

21. Estimated loss on asset disposition is:

a. P51,000 c. P51,000
b. 89,000 d. 90,000

22. Estimated gain as asset disposition is:

a. P56,000 c. P52,000
b. 54,000 d. 6,000
23. Estimated amount paid to unsecured creditors with priority is:
a. P10,000 c. P40,000
b. 30,000 d. 110,000

24. Estimated amount paid to fully secured creditors is:

a. P40,000 c. P470,000
b. 390,000 d. 430,000

25. Estimated amount paid to unsecured creditors without priority is:

a. P70,000 c. P20,000
b. 61,600 d. 50,000

26. Estimated payment to partially secured creditors is:

a. P358,800 c. P168,000
b. 516,800 d. 430,000

27. Estimated payment to creditors is (discrepancy is expected due to rounding off).

a. P580,000 c. P571,000
b. 659,600 d. 668,400

- END OF HANDOUT -