tuto 7

1. TUTORIAL 7 - A141
SOLUTION
QUESTION 1
Statement of Receipts & Payments
Realization of assets
Property 1 49,000
(-) Bond payable (49,000)
Other properties 180,000
Plant 1 98,000
(-) Long term loan (58,000) 40000
Equipment 100,000
Cash and bank balance 183,500
Account receivables (0.7 x 410,000) 287,000
Inventory (0.4 x 29,000) 11,600
Total proceeds from asset's realization 802,100
Payments & Liabilities
Cost of winding up 80
Bond payable-secured (57-49m) 8,000
Interest payable 8,000
Acc payables 580,000
Total payments 596,080
Balance available for distributions 206,020
Surplus = 206,020 – 181,000 = 25020
Shareholders Distributions
Shares value Share of surplus Distributions
Ordinary shares 165,000 25020 190,020
Preference shares 16,000 16,000
181,000 25020 206,020

2. QUESTION 2
Statement of receipts & payments
Realization of assets
Property 1 58,000
(-) Bond Payable (58,000) -
Plant 60,000
(-) Long term loan (58,000) 2,000
Property 2 18,000
Other Properties 119,500
Equipment 50,000
Cash and bank balance 120,450
Account receivables (0.2 x 125,000) 25,000
Inventory (0.4 x 41,200) 16,480
Total proceeds from asset's realization 351,430
Payments & Liabilities
Cost of winding up 40
Wages & Salaries 620
Dividend payable (0.04 x 8mill) 320
Bond payable-unsecured (60m-58m) 2,000
Interest payable 11,850
Trade creditors 157,500
Total payments 172,330
Balance available for distributions 179,100
Loss = 277,500 – 179,100 = 98,400
Shareholders Distributions
Shares value Share of losses Distributions
Ordinary shares 269,500 (95,563) 173,937
Preference shares 8,000 (2,837) 5,163
277,500 (98,400) 179,100

3. Account Receipts & Payments
Property 1 58,000 Cost of winding up 40
(-) Bond Payable (58,000) - Wages & Salaries 620
Plant 60,000 Dividend payable 320
(-) Long term loan (58,000) 2,000 Bond payable-unsecured 2,000
Property 2 18,000 Interest payable 11,850
Other Properties 119,500 Trade creditors 157,500
Equipment 50,000 Balance c/d 179,100
Cash and bank balance 120,450
Account receivables 25,000
Inventory 16,480
351,430 351,430
Balance c/d 179,100 Distribution to s/holders:
Preference share 173,937
Ordinary shares 5,163
179,100 179,100