When a Liquidating Corporation Pays Off an Unsecured Debt Obligation

question 98

Multiple Choice

When a liquidating corporation pays off an unsecured debt obligation,

• A)the corporation recognizes no gain or loss if it uses appreciated property.
• B)the corporation recognizes no gain or loss if it uses cash.
• C)the corporation recognizes any gains but not losses realized.
• D)the corporation recognizes losses but not gains realized.

---

Definitions:

Profit Maximization

The process of increasing a firm's economic surplus, aiming to achieve the highest possible profit from its operations.

Minority Union

A labor union that represents a smaller number of employees within a workplace or sector compared to a larger, competing union or where collective bargaining rights are not exclusively held.

Economic Downturn

A period of decline in economic performance across a significant portion of the economy, characterized by reduced industrial activity, increased unemployment, and lower consumer spending.

HR Manager

A Human Resources Manager, responsible for overseeing all aspects of employee relations, including recruitment, training, and compliance with labor laws.