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

Question

Quizplus · Accepted Answer

The sum of the claims of secured creditors is $1,200,000 ($800,000 + $400,000). The total value of the estate is $1.2 million, so the unsecured creditors cannot receive anything. The secured creditors have priority over the unsecured creditors, so they will receive their full claim amount. $1,200,000/$1,428,571 = 84.1%, which is the percentage of their claim that the secured creditors will receive.

How Much and What Percentage of Their Claim Will the Secured