In Order for a Payment Made by an Insolvent Debtor

question 21

True/False

In order for a payment made by an insolvent debtor within the six month limitation period to be declared void,the payment must be shown to favour one or more of the bankrupt's creditors to the detriment of the others.

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Definitions:

Income Statement

A financial document that reports a company's revenues, expenses, and profits over a specific period.

Liabilities

Financial obligations or debts that an entity owes to others, which must be settled over time through the transfer of economic benefits.

Assets

Economic resources or valuable items that a business owns or controls with the expectation that they will provide future benefits.

Mismanagement Decisions

Poor or inefficient decisions made in the management of a company that can lead to negative outcomes or failure.