The Details Below Were Extracted from the Accounting Records of Great

Multiple Choice

The details below were extracted from the accounting records of Great South East Ltd (a company in the process of liquidation) .
$\begin{array}{ll}&\$\\40000 \$ 1 \text { preference shares fully paid } & 40000 \\ 120000 \$ 1 \text { ordinary shares paid to } 50 \text { cents } & \underline{60000} \\ & \underline{100000}\\\\ \text { Cash available (after payment of all creditors) }&10000\end{array}$


Assume that the constitution of Great South East Ltd states that in the event of liquidation, all shares are to rank equally, based on the number of shares held, in distributing any surplus or deficiency.
What will be the deficiency or surplus apportioned to preference shareholders?

A) A surplus of $22 500
B) A deficiency of $22 500
C) A surplus of $67 500
D) A deficiency of $67 500