Bankruptcy can provide only for the liquidation of the business;reorganization is not an option.

Bankruptcy

A legal process involving a person or business that is unable to repay outstanding debts, resulting in the distribution of assets to creditors and possibly leading to the discharge of debts.

Liquidation

The process of closing a business and distributing its assets to claimants, typically during insolvency, paying creditors, and shareholders if funds remain.

Reorganization

The process of restructuring a company's business or legal structures for efficiency, to recover from financial distress, or to better align with strategic goals.

Understand the significance and consequences of bankruptcy laws, and their effect on how firms reorganize and how creditors are ranked in priority.

Verified Answer

Hashir MasoodAug 02, 2024

Final Answer :

False

Explanation :

Bankruptcy can also provide for business reorganization through Chapter 11 bankruptcy. This allows businesses to restructure their debts and operations while staying in business.

Learning Objectives

Understand the significance and consequences of bankruptcy laws, and their effect on how firms reorganize and how creditors are ranked in priority.

Bankruptcy can provide only for the liquidation of the business;reorganization is not an option.

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Learning Objectives

Learning Objectives

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