Equipment with a Book Values of $120,000 Is Sold in a Liquidation

question 10

Multiple Choice

Equipment with a book values of $120,000 is sold in a liquidation process for cash of $110,000.This equipment was security for a $150,000 bank loan.Any remainder is consider unsecured without priority.How would this transaction be reported on the Statement of Realization and Liquidation?

• A)​A reduction in noncash assets of $120,000
• B)​A loss reported to owner's equity of $10,000
• C)​A disbursement of cash to the bank of $110,000, a reduction in partially secured liability of $150,000, and an increase in unsecured without priority liability of $40,000
• D)​all of the above would occur

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Definitions:

Status Groups

Differ from one another in terms of the prestige or social honour they enjoy and also in terms of their style of life.

Impose Their Will

the act of forcing one's decisions, beliefs, or desires onto another person or group, often without their consent.

Status Groups

Communities or social collectives that people belong to based on prestige, honor, lifestyle, or other social characteristics, distinguishing them from other groups.

Prestige And Way Of Life

Refers to the high social status and lifestyle associated with certain occupations, activities, or societal roles.