Oregon 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 $21,000 and accounts receivable of $40,000.
In addition, the company owns four plots of land.
The first two (labeled A and B) cost $23,000 each.
Plots C and D cost the company $35,000 and $40,000, respectively.
A mortgage lien is attached to each parcel of land as security for four different notes payable of $30,000 each.
Presently, the land can be sold for the following:
Plot A $ 31,000
Plot B $ 26,000
Plot C $ 29,000
Plot D $ 57,000
Another $33,000 note payable is unsecured.
Accounts payable at this time total $62,000. Of this amount, $16,000 is salary owed to the company’s workers. No employee is due more than $4,900.
The company expects to collect $27,000 from the accounts receivable if liquidation becomes necessary.
Administrative expenses required for liquidation are anticipated to be $52,440.
Prepare a statement of financial affairs for Oregon Corporation.