Reference no: EM132641271

Question - A compulsory winding up in insolvency order was issued by the court in respect of Rock Bottom Ltd. The company had a capital of 65 000 fully paid ordinary shares of $1 each. The liquidator took possession of the company's assets which raised $873 145 on sale. Included in the sale proceeds was $221 000 from the disposal of the land and buildings.

The creditors submitted their claims and the following debts were admitted as proven: as proven:

Liquidation expenses $3900

Liquidator's remuneration $10400

Mortgage loan secured on land and buildings $130000

Additional mortgage loan on land and buildings $104000

Employees' wages 5 employees for 2 weeks at $520 per week

Secretary's salary - 3 weeks at $314 per week $942

Employees' holiday pay $6500

Sales commission $650

Managing director's salary - 4 weeks at $780 per week

Directors' fees $3 900

Trade creditors $104 000

Unsecured loan stock $130 000

Debentures (secured by circulating security interest) $390 000

PAYG tax instalment $1 014

Fringe benefits tax $2 600

GST $2 586

Required - Show the order of priority of payment of debts for Rock Bottom Ltd and calculate the amount payable to the company's ordinary unsecured creditors.