An Insolvent Is a Person Who Is Unable to Pay

question 15

True/False

An insolvent is a person who is unable to pay debts as and when they fall due out of the debtor's own funds.

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Definitions:

Dividends

Payments made by a corporation to its shareholder members, usually distributed from the company's profits.

Liquidation

Occurs when a business is terminated, the assets are sold, and liabilities and partners are paid off.

Creditors

Entities or individuals to whom a company owes money or has financial liabilities, often in the context of short or long-term borrowing.

Contract Rate

Rate of interest (based on face value) stated on bond certificate and bond indenture.