Corporate Liquidation

Question 1

Is the process of selling off all the assets of an entity, settling its liabilities, distributing any remaining funds to shareholders, and closing it down as a legal entity.

Answer 1

Liquidation

Question 2

Financial condition prepared for a corporation entering into the stage of liquidation or bankruptcy.

Answer 2

Statement of Affairs.

Question 3

Expected to realize an amount at least sufficient to satisfy the related debt.

Answer 3

Assets pledged with fully secured creditors.

Question 4

Expected to realize an amount below the related debt.

Answer 4

Assets pledged with partially secured creditors.

Question 5

Not pledged and are available to satisfy the claims of creditors with priority, partially secured creditors, and unsecured creditors.

Answer 5

Free Assets.

Question 6

Collateralized; expect to be paid in full as a result of having sufficient collateral to satisfy the indebtedness.

Answer 6

Fully secured liabilities

Question 7

Collateralized; the proceeds of which are expected to be insufficient to satisfy the indebtedness.

Answer 7

Partially Secured Liabilities

Question 8

With priority under the law.

Answer 8

Unsecured liabilities with priority.

Question 9

No collateral relating to their indebtedness.

Answer 9

Unsecured liabilities without priority.

Question 10

Estimated Recovery % Formula

Answer 10

Net Free Assets divided by the Total Unsecured Creditors