What percentage of creditor as claim is paid

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Reference no: EM132039141

Consider a firm which has a value of $7 million and is liquidated in Chapter 7. There are two outstanding claims. Creditor A has a claim for $5 million senior debt which is secured by a building valued at $3m. Creditor B has a senior debt claim of $6 million.

1) Which claim is paid out first?

2) How much creditor A gets in liquidation?

3) How much creditor B gets in liquidation?

4) What percentage of creditor A’s claim is paid?

5) What percentage of creditor B’s claim is paid?

Reference no: EM132039141

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