Bartleby Corporation is undergoing liquidation under Chapter 7 of the bankruptcy

Question

Bartleby Corporation is undergoing liquidation under Chapter 7 of the bankruptcy code. Bartleby reports total liabilities of $820,000. Its assets have a liquidation value of $650,000. Of those assets, $300,000 is pledged as security on debt obligations of $220,000, and another $120,000 is pledged as security on $180,000 of liabilities. Unsecured liabilities with priority are $30,000.

Calculate the net proceeds available to unsecured creditors without priority, and the dividend rate that they will receive under the liquidation.

Explanation / Answer

Answer: Net proceeds available to unsecured creditors without priority, and the dividend rate that they will receive under the liquidation:

=650000-300000-220000-30000

=100000

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