Question 1

In the case of an involuntary petition,the debtor must file the same schedules filed by voluntary petition debtors.

Accepted Answer

A) True 
 B)False

Question 2

A Chapter 13 plan may not be modified.

Accepted Answer

A) True 
 B)False

Question 3

In a Chapter 13,the debtor begins making payments to the trustee within 30 days after the plan has been approved.

Accepted Answer

A) True 
 B)False

Question 4

Bay State Bank loaned the Fabulously Fresh Seafood Company $300,000,with the fishing company's inventory as collateral.Fabulously Fresh has never missed a payment to Bay State,but has recently been missing payments to a number of its other creditors.On May 12,five other creditors filed an involuntary Chapter 7 bankruptcy petition against Fabulously Fresh.This was not objected to by Fabulously Fresh,and the judge entered an order for relief.Which of the following is the best description of Bay State's legal situation at this point?

Accepted Answer

A)  The automatic stay will prevent Bay State from taking any action relative to its debt until the bankruptcy proceeding is finalized. 
B)  Because Bay State is a secured creditor, the automatic stay would not apply to it. 
C)  Because Bay State did not sign the petition, it can take no actions against Fabulously Fresh. 
D)  Because the loan to Bay State has not had any missed payments, Bay State can take no actions against Fabulously Fresh. 
E)  Bay State would likely be granted relief from the automatic stay, since the inventory of Fabulously Fresh would likely lose value rapidly. 
A)  The automatic stay will prevent Bay State from taking any action relative to its debt until the bankruptcy proceeding is finalized. 
B)  Because Bay State is a secured creditor, the automatic stay would not apply to it. 
C)  Because Bay State did not sign the petition, it can take no actions against Fabulously Fresh. 
D)  Because the loan to Bay State has not had any missed payments, Bay State can take no actions against Fabulously Fresh. 
E)  Bay State would likely be granted relief from the automatic stay, since the inventory of Fabulously Fresh would likely lose value rapidly.

Question 5

Many parties are eager to extend credit to those who have just received a discharge in bankruptcy.One view is that such persons have no other debts,and thus are a relatively safe credit risk.Furthermore,such persons cannot qualify for another discharge in bankruptcy for a prescribed number of years.Many discharged debtors,however,incur excessive debts time and again.Should there be limits on the ability of those discharged in bankruptcy to incur new debt? What are the arguments for and against such a rule?

Accepted Answer

The argument against credit restrictions

Question 6

Bankruptcy courts are part of the federal court system,and one bankruptcy court is attached to each of the ninety-four United States district courts in the country.

Accepted Answer

A) True 
 B)False

Question 7

In order for the bankruptcy court to confirm a plan over the objection of a class of creditors,at least one class of creditors must have voted to accept the plan.

Accepted Answer

A) True 
 B)False

Question 8

The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 requires an individual filing for bankruptcy to receive:

Accepted Answer

A)  pre-petition counseling 
B)  post-petition counseling 
C)  pre-petition or post-petition counseling 
D)  pre-petition and post-petition counseling 
E)  concurrent-with-petition counseling 
A)  pre-petition counseling 
B)  post-petition counseling 
C)  pre-petition or post-petition counseling 
D)  pre-petition and post-petition counseling 
E)  concurrent-with-petition counseling

Question 9

The "means test" may be used to deny relief under Chapter 7.

Accepted Answer

A) True 
 B)False

Question 10

The Bankruptcy Reform Act of 1978 made it easier for debtors to rid themselves of unsecured debt,primarily by filing for Chapter 7 liquidation bankruptcy.

Accepted Answer

A) True 
 B)False

Question 11

Earnings from services performed by an individual debtor are not part of the bankruptcy estate in a Chapter 7 liquidation bankruptcy.

Accepted Answer

A) True 
 B)False

Question 12

There must be confirmation of a Chapter 11 plan of reorganization by the bankruptcy court for the debtor to be reorganized under Chapter 11.

Accepted Answer

A) True 
 B)False

Question 13

Under the 2005 Act,in Chapter 13 bankruptcy,if the debtor's monthly income multiplied by 12 exceeds the state's median income for the same-sized family,the plan may not exceed three years.

Accepted Answer

A) True 
 B)False

Question 14

The filing of a Chapter 13 petition does not automatically stay collection activities against co-debtors and guarantors of consumer debts.

Accepted Answer

A) True 
 B)False

Question 15

The Bankruptcy Code is contained in ________ of the United States Code.

Accepted Answer

A)  Article I 
B)  Article II 
C)  Title 1 
D)  Title 11 
E)  Section II 
A)  Article I 
B)  Article II 
C)  Title 1 
D)  Title 11 
E)  Section II

Question 16

The Bankruptcy Code's federal homestead exemption is ________.

Accepted Answer

A)  $20,000 
B)  $21,625 
C)  $40,000 
D)  $41,625 
E)  $60,000 
A)  $20,000 
B)  $21,625 
C)  $40,000 
D)  $41,625 
E)  $60,000

Question 17

A creditor must file a ________ stating the amount of his or her claim against the debtor.

Accepted Answer

A)  proof of judgment 
B)  proof of claim 
C)  proof of equity 
D)  motion for directed verdict 
E)  motion for declaratory judgment 
A)  proof of judgment 
B)  proof of claim 
C)  proof of equity 
D)  motion for directed verdict 
E)  motion for declaratory judgment

Question 18

If a secured creditor objects to a debtor payment plan,the court may still confirm the plan under some circumstances.

Accepted Answer

A) True 
 B)False

Question 19

Under Chapter 11 bankruptcy,discharge of debts not included to be paid in the reorganization occurs only after the reorganization plan has been executed.

Accepted Answer

A) True 
 B)False

Question 20

A Chapter 13 bankruptcy may be filed by a sole proprietorship.

Accepted Answer

A) True 
 B)False

Exam 24: Bankruptcy and Reorganization

In the case of an involuntary petition,the debtor must file the same schedules filed by voluntary petition debtors.

A Chapter 13 plan may not be modified.

In a Chapter 13,the debtor begins making payments to the trustee within 30 days after the plan has been approved.

Bankruptcy courts are part of the federal court system,and one bankruptcy court is attached to each of the ninety-four United States district courts in the country.

In order for the bankruptcy court to confirm a plan over the objection of a class of creditors,at least one class of creditors must have voted to accept the plan.

The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 requires an individual filing for bankruptcy to receive:

The "means test" may be used to deny relief under Chapter 7.

The Bankruptcy Reform Act of 1978 made it easier for debtors to rid themselves of unsecured debt,primarily by filing for Chapter 7 liquidation bankruptcy.

Earnings from services performed by an individual debtor are not part of the bankruptcy estate in a Chapter 7 liquidation bankruptcy.

There must be confirmation of a Chapter 11 plan of reorganization by the bankruptcy court for the debtor to be reorganized under Chapter 11.

Under the 2005 Act,in Chapter 13 bankruptcy,if the debtor's monthly income multiplied by 12 exceeds the state's median income for the same-sized family,the plan may not exceed three years.

The filing of a Chapter 13 petition does not automatically stay collection activities against co-debtors and guarantors of consumer debts.

The Bankruptcy Code is contained in ________ of the United States Code.

The Bankruptcy Code's federal homestead exemption is ________.

A creditor must file a ________ stating the amount of his or her claim against the debtor.

If a secured creditor objects to a debtor payment plan,the court may still confirm the plan under some circumstances.

Under Chapter 11 bankruptcy,discharge of debts not included to be paid in the reorganization occurs only after the reorganization plan has been executed.

A Chapter 13 bankruptcy may be filed by a sole proprietorship.

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