From what I understand mtgox lost bitcoins but I had traded the bitcoins for dollars before the bankruptcy. Am I understanding it correctly or am I wrong?
MtGox has millions of USD missing according to the latest news reports. The final draft of what, where, how and why has yet to be published by the administrator however.
Some customers who lost money with MtGox are under the false impression that since their funds were in fiat currency instead of Bitcoin they would be safe and receive all of their money back, this simply isn't the case.
The administrator has already hinted the remaining coins would be sold and all assets pooled for even redistribution. There has been strong support for receiving Bitcoin instead of fiat amongst some creditors but it has yet to be seen how the administrator distributes the remaining funds.
If however MtGox is sold to another entity then this would obviously change the dynamics of the situation. For now there is not much to do but wait for the administrator to finalize his report and wait on an outcome for redistribution or sale.
As I understand it, it's irrelevant whether you had dollars or bitcoins with them. Either way, they are bankrupt and you are a creditor. You have to file a claim in the bankruptcy proceeding to ask for your share of whatever assets the court may find that they have.