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Give step-by-step solution with explanation and final answer: solve only part aOregon Corporation has filed a voluntary petition to reorganize under Chapter 11 of the Bankruptcy Reform Act. Its creditors are considering an attempt to force liquidation. The company currently holds cash of $29,000 and accounts receivable of $48,000. In addition, the company owns four plots of land. The first two (labeled A and B) cost $31,000 each. Plots C and D cost the company $43,000 and $48,000, respectively. A mortgage lien is attached to each parcel of land as security for four different notes payable of $38,000 each. Presently, the land can be sold for the following: Plot A $ 39, 000 Plot B $ 34,000 Plot C $37,000 Plot D $73,000 Another $45,000 note payable is unsecured. Accounts payable at this time total $78,000. Of this amount, $24,000 is salary owed to the company's workers. No employee is due more than $5,700. The company expects to collect $35,000 from the accounts receivable if liquidation becomes necessary. Administrative expenses required for liquidation are anticipated to be $68,720. a. Prepare a statement of financial affairs for Oregon Corporation. b. Ifthe company is liquidated, how much cash would be paid on the note payable secured by plot 8? c. Ifthe company is liquidated, how much cash would be paid on the unsecured note payable? d. Ifthe company is liquidated and plot D is sold for $78,200, how much cash would be paid on the note payable secured by plot B?

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Give step-by-step solution with explanation and final answer: solve only part aUploaded ImageOregon Corporation has filed a voluntary petition to reorganize under Chapter 11 of the Bankruptcy Reform Act. Its creditors are considering an attempt to force liquidation. The company currently holds cash of $29,000 and accounts receivable of $48,000. In addition, the company owns four plots of land. The first two (labeled A and B) cost $31,000 each. Plots C and D cost the company $43,000 and $48,000, respectively. A mortgage lien is attached to each parcel of land as security for four different notes payable of $38,000 each. Presently, the land can be sold for the following: Plot A $ 39, 000 Plot B $ 34,000 Plot C $37,000 Plot D $73,000 Another $45,000 note payable is unsecured. Accounts payable at this time total $78,000. Of this amount, $24,000 is salary owed to the company's workers. No employee is due more than $5,700. The company expects to collect $35,000 from the accounts receivable if liquidation becomes necessary. Administrative expenses required for liquidation are anticipated to be $68,720. a. Prepare a statement of financial affairs for Oregon Corporation. b. Ifthe company is liquidated, how much cash would be paid on the note payable secured by plot 8? c. Ifthe company is liquidated, how much cash would be paid on the unsecured note payable? d. Ifthe company is liquidated and plot D is sold for $78,200, how much cash would be paid on the note payable secured by plot B?

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Asked by: Nishant Saini
Created at: 2025-09-27 07:16:42

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Let's solve **part a**: *Prepare a statement of financial affairs for Oregon Corporation.* --- ## Step-by-Step Solution ### 1. **Assets** | Asset | Book Value | Realizable Value (if liquidated) | |-------------------------||-----------------------------------| Cash $29,000 | $29,000 | | Accounts Receivable | $48,000 | $35,000 | | Plot A | $43,000 | $39,000 | | Plot B | $48,000 | $34,000 | | Plot C | $43,000 | $37,000 | | Plot D | $48,000 | $73,000 | #### **Total Book Value of Assets:** $29,000 + $48,000 + $43,000 + $48,000 + $43,000 + $48,000 = **$259,000** #### **Total Realizable Value of Assets:** $29,000 + $35,000 + $39,000 + $34,000 + $37,000 + $73,000 = **$247,000** --- ### 2. **Liabilities** #### **Secured Liabilities:** - Mortgage note on Plot A: $38,000 - Mortgage note on Plot B: $38,000 - Mortgage note on Plot C: $38,000 - Mortgage note on Plot D: $38,000 #### **Unsecured Liabilities:** - Note Payable (unsecured): $45,000 - Accounts Payable: $78,000 - Of this, salary owed to workers: $24,000 #### **Total Liabilities:** 1. **Secured:** $38,000 × 4 = $152,000 2. **Unsecured:** $45,000 + $78,000 = $123,000 --- ### 3. **Administrative Expenses (if liquidated)** - Administrative expenses: $68,720 --- ### 4. **Statement of Financial Affairs** #### **ASSETS** | Description | Book Value | Realizable Value | |------------------------|------------|------------------| | Cash | $29,000 | $29,000 | | Accounts Receivable | $48,000 | $35,000 | | Plot A | $43,000 | $39,000 | | Plot B | $48,000 | $34,000 | | Plot C | $43,000 | $37,000 | | Plot D | $48,000 | $73,000 | | **Total** | $259,000 | $247,000 | #### **LIABILITIES** | Description | Amount | |-------------------------------------- |----------:| | Mortgage Note (Plot A, secured) | $38,000 | | Mortgage Note (Plot B, secured) | $38,000 | | Mortgage Note (Plot C, secured) | $38,000 | | Mortgage Note (Plot D, secured) | $38,000 | | Note Payable (Unsecured) | $45,000 | | Accounts Payable (Unsecured) | $78,000 | |  - Salary Owed (Included in above) | $24,000 | | **Total Liabilities** | $275,000 | #### **ADMINISTRATIVE EXPENSES (If liquidated):** - $68,720 --- ### **Summary Table** | Item | Book Value | Realizable Value | |-------------------------------|------------|------------------| | **Total Assets** | $259,000 | $247,000 | | **Total Liabilities** | - | $275,000 | | **Administrative Expenses** | - | $68,720 | --- ## **Final Answer** > **Statement of Financial Affairs for Oregon Corporation:** > > - **Assets (Book Value): $259,000** > - **Assets (Liquidation Value): $247,000** > - **Total Liabilities: $275,000** > - (Secured: $152,000; Unsecured: $123,000) > - **Administrative Expenses (if liquidated): $68,720** --- Let me know if you need part **b**, **c**, or **d** explained!

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