a.The solution approach is similar to that shown in Problem 2-9.  Gains or losses can be calculated for the sale (or collection) of each of Kimber Co.’s non-cash assets, as follows:

# $343,000 - $195,000 accumulated depreciation = $148,000 book value of buildings&equipment.

The $405,583 cash received from the liquidation of non-cash assets would be added to the beginning cash balance of $18,400, and $423,983 is the amount of cash available to pay the claims of creditors and stockholders.  Liabilities would be paid first (including the amounts that are not shown on the balance sheet), and the balance would be paid to the stockholders:

Total cash available		$423,983
Accounts payable	$46,700
Notes payable	58,500
Wages payable (not shown on balance sheet)	2,400
Interest payable (not shown on balance sheet)	5,250
Long-term debt	64,800	(177,650)
Total cash available to stockholders		$246,333

The total cash available to stockholders upon liquidation can be verified, as follows:

Total owners’ equity (unadjusted, from balance sheet)	$224,700
Add: Gain on sale of buildings&equipment	40,000
Add: Gain on sale of land	14,000
Less: Loss on collection of accounts receivable	(7,512)
Less: Loss on liquidation of merchandise inventory	(17,205)
Less: Unrecorded wages expense	(2,400)
Less: Unrecorded interest expense	(5,250)
Total owners’ equity, as adjusted	$246,333