What Would Be the Priority of the Claims as to the Distribution

question 3

Multiple Choice

What would be the priority of the claims as to the distribution of assets in a liquidation under Chapter 7 of the Bankruptcy Act? 1 is the highest claim, 5 is the lowest.
(1) Trustees' costs to administer and operate the firm.
(2) Common stockholders.
(3) General, or unsecured, creditors.
(4) Secured creditors, who have a claim to the proceeds from the sale of specific property pledged to secure a loan.
(5) Taxes due to federal and state governments.

• A) 5, 4, 1, 3, 2
• B) 4, 1, 5, 3, 2
• C) 5, 1, 4, 2, 3
• D) 1, 5, 4, 3, 2
• E) 1, 4, 3, 5, 2

---

Definitions:

Abnormal Newborn Screen

Initial testing results for a newborn that indicate possible health concerns or congenital disorders requiring further investigation.

Hypertension

A condition characterized by persistently high arterial blood pressure, which if untreated, can lead to cardiovascular diseases.

Language Development

The process by which children come to understand and communicate language during early childhood.

Sentences

A set of words that is complete in itself, typically containing a subject and predicate, and conveying a statement, question, exclamation, or command.