Question 1

Straight bankruptcy is another term for:

Accepted Answer

A)  discharge bankruptcy. 
B)  liquidation bankruptcy. 
C)  reorganization bankruptcy. 
D)  a consumer debt adjustment. 
E)  loss bankruptcy. 
A)  discharge bankruptcy. 
B)  liquidation bankruptcy. 
C)  reorganization bankruptcy. 
D)  a consumer debt adjustment. 
E)  loss bankruptcy.

Question 2

A Chapter 13 proceeding can be initiated only through the filing of a voluntary petition by a debtor who alleges that he or she is insolvent,and barely able to pay debts when they come due.

Accepted Answer

A) True 
 B)False

Question 3

The bankruptcy estates includes all the debtor's legal and equitable interests in real,personal,tangible,and intangible property,wherever located,that exist when the petition is filed,and all interests of the debtor and debtor's spouse in community property.

Accepted Answer

A) True 
 B)False

Question 4

In a Chapter 11 bankruptcy case,the debtor usually continues to operate the business as a debtor-in-possession.

Accepted Answer

A) True 
 B)False

Question 5

Matt is planning to file for bankruptcy.He wants to keep some of his property,so he gives certain jewelry to his parents,with the understanding that they will return it later.Matt also sells his car,worth $5,000,to his girlfriend for $100.These transfers are:

Accepted Answer

A)  preferential transfers. 
B)  voidable preferences. 
C)  fraudulent transfers. 
D)  legitimate distributions of assets. 
E)  void preferences. 
A)  preferential transfers. 
B)  voidable preferences. 
C)  fraudulent transfers. 
D)  legitimate distributions of assets. 
E)  void preferences.

Question 6

The filing of a voluntary petition,but not an unchallenged involuntary petition,constitutes an order for relief.

Accepted Answer

A) True 
 B)False

Question 7

Which two states were cited in the textbook as having homestead exemptions without a maximum dollar limit?

Accepted Answer

A)  Texas and New York 
B)  Florida and California 
C)  New York and Florida 
D)  New York and California 
E)  Texas and Florida 
A)  Texas and New York 
B)  Florida and California 
C)  New York and Florida 
D)  New York and California 
E)  Texas and Florida

Question 8

One goal of federal bankruptcy law is to give debtors a "fresh start" by relieving them from legal responsibility for past debts.

Accepted Answer

A) True 
 B)False

Question 9

Chapter 13 is a rehabilitation form of bankruptcy for individuals.

Accepted Answer

A) True 
 B)False

Question 10

Once appointed,a bankruptcy ________ becomes the legal representative of the debtor's estate.

Accepted Answer

A)  conservator 
B)  guardian 
C)  referee 
D)  trustee 
E)  agent 
A)  conservator 
B)  guardian 
C)  referee 
D)  trustee 
E)  agent

Question 11

If a home was purchased within 1,215 days before the bankruptcy petition was filed,the federal homestead exemption under the 2005 Act limits the homestead exemption to:

Accepted Answer

A)  $25,000 of the home's equity. 
B)  $50,000 of the home's equity. 
C)  $100,450 of the home's equity. 
D)  $146,450 of the home's equity. 
E)  $150,450 of the home's equity. 
A)  $25,000 of the home's equity. 
B)  $50,000 of the home's equity. 
C)  $100,450 of the home's equity. 
D)  $146,450 of the home's equity. 
E)  $150,450 of the home's equity.

Question 12

For a fraudulent transfer to be voided,it must have been made to an insider of the bankruptcy petitioner.

Accepted Answer

A) True 
 B)False

Question 13

If the debtor challenges an involuntary petition,a trial is held to determine whether an order for relief should be granted.

Accepted Answer

A) True 
 B)False

Question 14

What is the general concept of the "fresh start" in bankruptcy?

Accepted Answer

A)  Debtors are given a new start in paying off their existing debts. 
B)  Creditors are given a new start in collecting amounts owed to them. 
C)  Businesses adopt new business plans. 
D)  Debtors have most debts discharged, and "start over" without those debts. 
E)  Debtors' past problems are erased from their credit records, and they "start over" with a "clean slate," and all debts discharged. 
A)  Debtors are given a new start in paying off their existing debts. 
B)  Creditors are given a new start in collecting amounts owed to them. 
C)  Businesses adopt new business plans. 
D)  Debtors have most debts discharged, and "start over" without those debts. 
E)  Debtors' past problems are erased from their credit records, and they "start over" with a "clean slate," and all debts discharged.

Question 15

A reaffirmation agreement need not be filed with the bankruptcy court.

Accepted Answer

A) True 
 B)False

Question 16

Sarah is the president and CEO of a company that is experiencing financial problems. She has decided to file for bankruptcy,and has asked you for advice.If she wants to keep the business open,retain most of her employees' jobs,and continue in business in the future,she should file for:

Accepted Answer

A)  Chapter 7. 
B)  Chapter 9. 
C)  Chapter 11. 
D)  Chapter 13. 
E)  Chapter 15. 
A)  Chapter 7. 
B)  Chapter 9. 
C)  Chapter 11. 
D)  Chapter 13. 
E)  Chapter 15.

Question 17

Article II,Section 4,clause 2 of the United States Constitution provides that "The Congress shall have the power...to establish...uniform laws on the subject of bankruptcies throughout the United States."

Accepted Answer

A) True 
 B)False

Question 18

The debtor in a Chapter 13 bankruptcy proceeding can keep more property than under a Chapter 7 proceeding.

Accepted Answer

A) True 
 B)False

Question 19

The debtor-in-possession is empowered to operate the debtor's business during the Chapter 11 bankruptcy proceeding.

Accepted Answer

A) True 
 B)False

Question 20

A party cannot be petitioned into bankruptcy against that party's will.

Accepted Answer

A) True 
 B)False

Exam 24: Bankruptcy and Reorganization

Straight bankruptcy is another term for:

A Chapter 13 proceeding can be initiated only through the filing of a voluntary petition by a debtor who alleges that he or she is insolvent,and barely able to pay debts when they come due.

The bankruptcy estates includes all the debtor's legal and equitable interests in real,personal,tangible,and intangible property,wherever located,that exist when the petition is filed,and all interests of the debtor and debtor's spouse in community property.

In a Chapter 11 bankruptcy case,the debtor usually continues to operate the business as a debtor-in-possession.

Matt is planning to file for bankruptcy.He wants to keep some of his property,so he gives certain jewelry to his parents,with the understanding that they will return it later.Matt also sells his car,worth $5,000,to his girlfriend for $100.These transfers are:

The filing of a voluntary petition,but not an unchallenged involuntary petition,constitutes an order for relief.

Which two states were cited in the textbook as having homestead exemptions without a maximum dollar limit?

One goal of federal bankruptcy law is to give debtors a "fresh start" by relieving them from legal responsibility for past debts.

Chapter 13 is a rehabilitation form of bankruptcy for individuals.

Once appointed,a bankruptcy ________ becomes the legal representative of the debtor's estate.

If a home was purchased within 1,215 days before the bankruptcy petition was filed,the federal homestead exemption under the 2005 Act limits the homestead exemption to:

For a fraudulent transfer to be voided,it must have been made to an insider of the bankruptcy petitioner.

If the debtor challenges an involuntary petition,a trial is held to determine whether an order for relief should be granted.

What is the general concept of the "fresh start" in bankruptcy?

A reaffirmation agreement need not be filed with the bankruptcy court.

Sarah is the president and CEO of a company that is experiencing financial problems. She has decided to file for bankruptcy,and has asked you for advice.If she wants to keep the business open,retain most of her employees' jobs,and continue in business in the future,she should file for:

Article II,Section 4,clause 2 of the United States Constitution provides that "The Congress shall have the power...to establish...uniform laws on the subject of bankruptcies throughout the United States."

The debtor in a Chapter 13 bankruptcy proceeding can keep more property than under a Chapter 7 proceeding.

The debtor-in-possession is empowered to operate the debtor's business during the Chapter 11 bankruptcy proceeding.

A party cannot be petitioned into bankruptcy against that party's will.

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