Ashitaka Has Declared Bankruptcy and His Trustee Is Currently Dividing

question 40

Multiple Choice

Ashitaka has declared bankruptcy and his trustee is currently dividing his assets.Ashitaka has three creditors.The first, a bank, has security on a loan for $30 000.The second is his friend, who is owed $6000.The third is the government, which is owed $5000 in taxes.Ashitaka has only one relevant asset, a painting, with fair market value of $33 000. That painting is subject to the bank's security.Which of the following statements is most likely to be TRUE?

• A)The bank gets $30 000, the government $3000, and his friend $0.
• B)The bank gets $30 000, the government and his friend get $1500 each.
• C)Each creditor gets $11 000.
• D)The government gets $5000, the bank $28 000, and his friend $0.
• E)The government gets $5000, his friend gets $1000, and the bank gets $27 000.