Pat's Boats is being liquidated.The administrative costs of liquidation,taxes,and wage payments are expected to be $450,000.Secured creditors have a mortgage lien for $1.4 million on the real estate which was just liquidated and netted proceeds of $1.2 million.The other secured creditors have submitted claims totaling $274,000 and the unsecured submitted claims are $323,000.The remaining assets are expected to net $475,000.What payout should the unsecured creditors expect per each $1 claim?

Question

Quizplus · Accepted Answer

The unsecured creditors should expect $0 per each $1 claim because after paying the administrative costs, taxes, wage payments, and secured creditors, there are no funds left for the unsecured creditors.

Pat's Boats Is Being Liquidated