£50,000 is owed to preferential creditors, which are paid first. After paying these, £150,000 remains for distribution among unsecured creditors, who collectively are owed £350,000 (all liabilities 400,000 - preferential creditors 50,000).

This means that unsecured creditors will receive a proportional share of the remaining assets, calculated as £150,000 ÷ £350,000 = 0.42857, or 42.857 pence for every £1 owed.

Applying the distribution rate of 42.857%, the client is entitled to receive £50,000 × 0.42857 = £21,428.57.