Garuda Excavations Purchased a 5 Tonne Excavator from Tonka Inc

Garuda Excavations purchased a 5 tonne excavator from Tonka Inc for $350 000 with the help of a secured loan for that amount from Bank X.The loan covered the full amount of the purchase and was secured against the machinery.Garuda used the excavator for two years, but notwithstanding Garuda's valiant efforts, the company was constantly in the red and was eventually petitioned into bankruptcy by its creditors.Upon learning of the petition, Bank X moved swiftly to realize on its security.It took immediate possession of the excavator, which it sold for $300 000.It will have an unsecured claim against Garuda's estate in bankruptcy for $50 000.