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3 years ago

Southwestern Wear Inc. has the following balance sheet:

Business

1 answer:

makkiz [27]3 years ago

7 0

Answer:

The investors will receive $343,750

Explanation:

In order to calculate the amount each class of investors receive we would have to calulate first the Balance available for Investors as follows:

Balance available for Investors=Total funds received -Trustee’s cost

Balance available for Investors=$2,500,000 -$281,250

Balance available for Investors =$2,218,750

Therefore, Balance available for stock holder=Balance available for Investors-Payment to Accounts payable-Notes Payable-Subordinated debentures

Balance available for stock holder=$2,218,750 - $375,000 -$750,000 - $750,000

Balance available for stock holder= $343,750

The investors will receive $343,750

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