How much and what percentage of their claim will the unsecured creditors receive, in total?

Question

Quizplus · Accepted Answer

The total amount available for unsecured creditors is $800,000 ($500,000 + $300,000). The total claim of unsecured creditors is $1,000,000. Therefore, they will receive $800,000/ $1,000,000 = 0.8 or 80% of their claim. As for the actual amount, we can calculate it by multiplying the amount of the claim by the percentage received: $363,636 ($1,000,000 x 0.3636) for each unsecured creditor. However, the question asks for the total amount received by all unsecured creditors, which is $290,909 ($363,636 x 0.8). Therefore, the correct answer is B.

How Much and What Percentage of Their Claim Will the Unsecured