Reference no: EM132589724

Question 1: XYZ company in the process of dissolution. A total of 40% of the accounts receivable amounting to USD100,000 is pledged on 5% payable notes amounting to USD50,000. Its net realizable value is USD35,000. Whereas all USD300,000 8% unpaid notes are pledged to machines with a USD200,000 realizable value. A sum of cash is still available in the bank of USD20,000. In the statement of business, the net realizable value of an independent asset is

A. USD80,000

B. USD40,000

C. USD60,000.

D. USD30,000

Question 2: Green Panda Company is preparing a statement of affairs for the liquidation process. Information shows that the inventory of finished goods amounting to USD336,000 can be sold with a profit of 20%. Meanwhile, in-process work is worth USD234,000 and can be sold at a price of USD330,000 if completed with an additional raw material cost of USD60,000 and labor cost of USD40,000. The remaining raw materials costing USD15,000 can be sold at 85% of the cost. The net realizable value of all inventory is

A. USD403,200

B. USD645,950

C. USD749,950

D. USD709,950