Buggy Whip Industries is being liquidated under Chapter 7 of the bankruptcy code.When it filed for bankruptcy, its balance sheet was a follows:

**Mortgage bonds are secured by land and buildings
Assume that the liquidation is a voluntary petition, that no unpaid contributions to employee benefit plans exist, and that no customer layaway deposits are involved.The proceeds from the liquidation of the company's assets are as follows:

Bankruptcy administration charges are $2,500,000.Determine the amount that the mortgage bondholders will receive in this liquidation.
A)$5,000,000
B)$6,500,000
C)$8,000,000
D)$10,500,000

Question

Buggy Whip Industries is being liquidated under Chapter 7 of the bankruptcy code.When it filed for bankruptcy, its balance sheet was a follows:

**Mortgage bonds are secured by land and buildings
Assume that the liquidation is a voluntary petition, that no unpaid contributions to employee benefit plans exist, and that no customer layaway deposits are involved.The proceeds from the liquidation of the company's assets are as follows:

Bankruptcy administration charges are $2,500,000.Determine the amount that the mortgage bondholders will receive in this liquidation.
A)$5,000,000 
B)$6,500,000 
C)$8,000,000 
D)$10,500,000

Quizplus · Accepted Answer

11ea4079_5161_8f36_87fe_0528ba4a74ba_TB2041_00

Buggy Whip Industries Is Being Liquidated Under Chapter 7 of the Bankruptcy