Exam 24: Bankruptcy and Reorganization

The majority of Chapter 11 proceedings are filed by corporations that want to reorganize their capital structure by receiving discharge of a portion of their debts.

A voluntary bankruptcy proceeding is initiated by the creditor or creditors,and forces the debtor into bankruptcy.

Property received from a divorce settlement is never part of a bankruptcy estate.

When a class of creditors does not approve of a plan of reorganization under Chapter 11,the court can order the plan into effect:

In terms of the priority of distributing bankruptcy estate assets,federal tax obligations are immediately below that of the expenses of administering the estate.

Chapter ________ permits a qualified debtor to propose a plan to pay all or a portion of the debts he or she owes in installments over a specified period of time.

Local Air is a small,locally-owned heating and air conditioning repair business.Business has not being going well,and Local Air's owner is contemplating bankruptcy.The owner is concerned,however,about the complexities and time involved in filing a traditional Chapter 11 bankruptcy.Assuming that Local Air has under $2 million in debts,what non-traditional Chapter 11 option is available for small businesses,and how does that option work?

The United States Bankruptcy Code is contained in Article II of the United States Code.

The bankruptcy estate is created upon the ________ of a bankruptcy case.

Discharge of unsatisfied debts will be denied if the debtor falsified,destroyed,or concealed records of his or her financial condition.

In bankruptcy,the automatic stay would prevent a secured creditor from repossessing any collateral.

The founders of the United States thought that the plight of debtors was so important that they included a provision in the U.S.Constitution giving states the authority to establish local bankruptcy laws.

Enforcing judgments obtained against the debtor are "stayed" by the filing of a voluntary or involuntary bankruptcy petition.

Homestead exemptions in some "debtor-haven" states are enormous compared to the homestead exemption allowed under federal bankruptcy law.Should states be able to provide homestead exemptions much larger than the federal exemption and the exemptions of most other states? Why would a state choose to have a large homestead exemption? What are the advantages and disadvantages of a large homestead exemption to such a state?

A bankruptcy case is commenced when a ________ is filed with a bankruptcy court.

A United States Trustee is a federal government official who has responsibility for handling and supervising many of the administrative tasks associated with a bankruptcy case.

The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 gives the bankruptcy court the power to void certain fraudulent transfers of a debtor's property made by the debtor within five (5)years prior to filing a petition for bankruptcy.

The bankruptcy judge attends the meeting of the creditors to maintain order,and assure that proper procedures are followed.

In a Chapter 13 bankruptcy proceeding,the debtor's plan of payment must be filed no later than 120 days after the order for relief.

Attorneys representing debtors in a bankruptcy proceeding are subject to fines and sanctions if the information contained in the bankruptcy petition and schedules is wrong.