Laguna Company

Statement of Affairs
October 31, 2016

Book values Assets Estimated

Realizable values Free Assets
Pledged to fully secured creditors:
107,000.00 Plant Assets 67,400.00
Mortgage payable 50,400.00 17,000.00

Pledged to partially secured creditor:

39,000.00 Inventories 18,000.00
Notes payable 21,000.00

Free Assets:
4,000.00 Cash 4,000.00
46,000.00 Receivables 46,000.00
2,000.00 Supplies 1,500.00 51,500.00
198,000.00 Total Free Assets 68,500.00
Less: Unsecured liabilities with priority 7,000.00
Net Free Assets 61,500.00
Deficiency 20,500.00
Unsecured liabilities without priority 82,000.00

Unsecured Liability
Liabilities witout priority
Fully secured:
50,400.00 Mortgage payable 50,400.00
Plant Assets 67,400.00

Partially secured:
21,000.00 Notes payable 21,000.00
Inventories 18,000.00 3,000.00

Unsecured with priority:

5,800.00 Wages payable 5,800.00
1,200.00 Property tax payable 1,200.00
 Total 7,000.00

Unsecured without priority:

60,000.00 Accounts Payable 60,000.00
19,000.00 Notes payable (40,000 - 21,000) 19,000.00 79,000.00
Total unsecured liabilities without priority 82,000.00

100,000.00 Common Stock

(59,400.00) Deficit
198,000.00

Claim
Fully secured creditor:
Mortgage payable 50,400.00 100%
Partially secured creditor:
Notes payable 21,000.00 96%
Unsecured creditors with priority
Wages payable 5,800.00 100%
Property tax payable 1,200.00 100%

Unsecured creditors without priority

Accounts Payable 60,000.00 75%
Notes payable (40,000 - 21,000) 19,000.00 75%

Carrying Value NRV

Cash 4,000.00 4,000.00
Accounts receivable 46,000.00 46,000.00
Inventories 39,000.00 18,000.00
Plant assets 107,000.00 67,400.00
Supplies 2,000.00 1,500.00
Net loss

Deficit (Retained Earnings)

Common Stock
Deficit (equal to deficiency computed in the statement of affairs
Recovery percentage 75%
 Payment

50,400.00

20,250.00

5,800.00
1,200.00

45,000.00
14,250.00

Gain/(loss)

(21,000.00)
(39,600.00)
(500.00)
(61,100.00)

(120,500.00)
100,000.00
(20,500.00)