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Accounting for Companies – II

notes Illustration 1 (Calculation of Liquidator’s Remuneration)
Sushil Co. Limited went into liquidation with the following liabilities:

(a) Secured Creditors ` 20,000 (securities realised ` 25,000)
(b) Preferential Creditors ` 6,000
(c) Unsecured Creditors ` 30,500
Liquidation Expenses ` 252
Liquidator’s Remuneration: 3% on the amount realised and 1½% on the amount distributed
to unsecured creditors. ` 26,000 were realised from various assets and this amount does
not include those securities which are with the secured creditors.

Prepare Liquidator’s Final Statement of Account. Liquidator is entitled for remuneration
of the amount realised on all the assets, including those which are with the secured
creditors.

Solution

sushil company limited
liquidator’s final statement of account
receipts amount payments amount
(`) (`)
Assets Realised 26,000 Liquidator Remuneration:
Surplus from Secured 3% on ` 51,000 1,530
Creditor (` 25,000 – ` 20,000) 5,000 3/2% on ` 6,000 90
% on ` 22,786.21 341.79 1,961.79
Liquidator Expenses 252
Preferential Creditors 6,000
Unsecured Creditors 22,786.21
31,000 31,000
Working Note:

Payment made to Unsecured Creditors- `
Total amount available 31,000
Less: Liquidator’s Remuneration on Assets Realised and Preferential Creditors
(` 1,530 + ` 90) =1,620

Liquidation expenses 252
Preferential Creditors 6,000 7,872
Amount available for Unsecured Creditors and Liquidator’s
Remuneration thereon. 23,128.00

Less: Liquidator’s remuneration 23,128 ×1.5 = 341.79
101.5
Payment to Unsecured Creditors 22,786.21

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