A Trustee Has Been Appointed for Smith Company,which Is Being

question 37

Essay

A trustee has been appointed for Smith Company,which is being liquidated under Chapter 7 of the Bankruptcy Code.The following transactions occurred after the assets were transferred to the trustee:
1.Credit sales by the trustee were $100,000.Cost of goods sold were $72,000,consisting of all the inventory transferred from Smith.
2.The trustee sold all $20,000 worth of marketable securities for $15,000.
3.Receivables collected by the trustee:
Old: $28,000 of the $50,000 transferred
New: $65,000
4.Disbursements by the trustee:
Old current payables: $31,000 of the $65,000 transferred
Trustee's expenses: $6,000
5.Recorded $24,000 depreciation on the plant assets of $120,000 transferred from Smith.
Required:
Prepare a statement of realization and liquidation according to the traditional approach illustrated in the chapter.

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Definitions:

Conscious Mind

The aspect of the mind that is aware of one's environment, thoughts, feelings, and experiences at the present moment.

Universal Language

A hypothetical or proposed language that is understood and spoken universally by all human beings.

Cultural Phenomenon

Any aspect, trend, or activity that significantly influences or characterizes the social practices, beliefs, and behaviors of a society or a specific time period.

Deliberate System

This pertains to a cognitive processing system that is conscious, analytical, and controlled, requiring effort and attention.