Chapter 13 14 exam

Topics: Balance sheet, Generally Accepted Accounting Principles, Asset Pages: 2 (681 words) Published: April 25, 2015
A Chapter 7 bankruptcy is a(n)
Where should a company undergoing reorganization report the gains and losses resulting from the reorganization?
on the income statement, separate from other gains and losses. How should liabilities (except for deferred income taxes) be reported by a company using fresh start accounting? at the present value of future cash payments.

Which one of the following unsecured liabilities has the highest priority when an insolvent company is about to be liquidated?
claims for expenses of administering the bankruptcy.
In a statement of financial affairs, assets are classified
according to whether they are pledged with particular creditors. The statement of financial affairs should be prepared
under the assumption that liquidation will occur.
What are free assets?
assets available to be distributed for liabilities with priority and for other unsecured obligations. On a statement of financial affairs, a specific liability may be classified as
secured or unsecured.
Which of the following is not one of the more common reorganization plan elements?
plans for plant expansion.
How are assets and liabilities valued on a Statement of Financial Affairs?

Option E
The partnership of Clapton, Seidel, and Thomas was insolvent and will be unable to pay $30,000 in liabilities currently due. What recourse was available to the partnership's creditors?
they may seek remuneration from any partner they choose.
Which of the following is not a characteristic of a partnership? partnership requires written Articles of Partnership.

Cleary, Wasser, and Nolan formed a partnership on January 1, 2012, with investments of $100,000, $150,000, and $200,000, respectively. For division of income, they agreed to (1) interest of 10% of the beginning capital balance each year, (2) annual compensation of $10,000 to Wasser, and (3) sharing the remainder of the income or loss in a ratio of 20% for Cleary, and 40% each for Wasser and...
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