Which One of the Following Statements Related to Chapter 7

question 57

Multiple Choice

Which one of the following statements related to Chapter 7 bankruptcy is correct?

• A)A firm in Chapter 7 bankruptcy is reorganizing its operations such that it can return to being a viable concern.
• B)Under a Chapter 7 bankruptcy, a trustee will assume control of the firm's assets until those assets can be liquidated.
• C)Chapter 7 bankruptcies are always involuntary on the part of the firm.
• D)Under a Chapter 7 bankruptcy, the claims of creditors are paid prior to the administrative costs of the bankruptcy.
• E)Chapter 7 bankruptcy allows a firm to restructure its equity such that new shares of stock are generally issued prior to the firm coming out of bankruptcy.

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