Question 1

Chapters 11 and 13 are liquidation chapters.

Accepted Answer

A) True 
 B)False  False

Question 2

Chapter 13 bankruptcy

Accepted Answer

A) is used by businesses to reorganize their financial situations. 
B) is an involuntary bankruptcy. 
C) can be used only by individuals with a regular source of income. 
D) is used by businesses to liquidate their debts. 
A) is used by businesses to reorganize their financial situations. 
B) is an involuntary bankruptcy. 
C) can be used only by individuals with a regular source of income. 
D) is used by businesses to liquidate their debts. C

Question 3

Peggy's credit card debts are mounting as her costs of insurance and fuel have dramatically increased and her income,from sporadic free-lance jobs,has dropped.Chapter 13 of the Bankruptcy Code will allow her to reorganize her debt while she keeps most of her assets.

Accepted Answer

A) True 
 B)False  False

Question 4

When Dudley files his Chapter 7 petition,he lists the following debts:
a.$25,000 in back child support and alimony.
b.$15,000 for liabilities incurred after drinking and driving.
c.$10,000 for past-due student loans.
d.$5,000 for past-due rent to his landlord.
e.$550 for a past-due phone bill.
How will each of these debts be treated by the bankruptcy court.

Accepted Answer

Certain debts are never discharged and t

Question 5

When a debtor no longer has an obligation to pay a debt,that debt has been

Accepted Answer

A) terminated. 
B) revoked. 
C) completed. 
D) discharged. 
A) terminated. 
B) revoked. 
C) completed. 
D) discharged.

Question 6

Under the federal Bankruptcy Code,the exemption amount for the debtor's personal residence is

Accepted Answer

A) $22,975. 
B) $55,200. 
C) unlimited. 
D) $125,000. 
A) $22,975. 
B) $55,200. 
C) unlimited. 
D) $125,000.

Question 7

Individual debtors are allowed to keep some assets in a Chapter 7 bankruptcy.

Accepted Answer

A) True 
 B)False

Question 8

Karen has filed for bankruptcy.Who has the authority to confirm or reject a plan of payment,and what factors will be considered when deciding whether to approve a repayment plan under Chapter 13?

Accepted Answer

The court has the sole authority to conf

Question 9

Creditors of Northern Hydraulics file an involuntary bankruptcy petition against the company and the petition is approved.What is true of Northern Hydraulics?

Accepted Answer

A) Northern Hydraulics has at least $10,425 in debts. 
B) There are at least 12 creditors. 
C) A custodian has automatically been appointed. 
D) It must make all the filings necessary under a voluntary petition. 
A) Northern Hydraulics has at least $10,425 in debts. 
B) There are at least 12 creditors. 
C) A custodian has automatically been appointed. 
D) It must make all the filings necessary under a voluntary petition.

Question 10

Francesca cannot serve as a trustee in a bankruptcy case because she is not a lawyer.

Accepted Answer

A) True 
 B)False

Question 11

Mark and Cynthia work for Bryson Supply Co.If the company files for Chapter 7 bankruptcy before paying their last month of wages and benefits,will they be able to recover anything from the company?

Accepted Answer

One goal of the Bankruptcy Code is to en

Question 12

An official acknowledgement that a debtor is under the jurisdiction of the bankruptcy court is called

Accepted Answer

A) a voluntary petition. 
B) an involuntary petition. 
C) an automatic stay. 
D) an order for relief. 
A) a voluntary petition. 
B) an involuntary petition. 
C) an automatic stay. 
D) an order for relief.

Question 13

Chapter 7 bankruptcy is also known as

Accepted Answer

A) reorganization. 
B) reaffirmation. 
C) voluntary bankruptcy. 
D) straight bankruptcy. 
A) reorganization. 
B) reaffirmation. 
C) voluntary bankruptcy. 
D) straight bankruptcy.

Question 14

Grand Lighting Co.has filed a petition for voluntary bankruptcy under Chapter 7 of the Code.Which of the following will prohibit creditors from collecting debts that Grand Lighting incurred before the petition was filed?

Accepted Answer

A) An automatic stay 
B) A proof of claim 
C) A voluntary petition 
D) A discharge statement 
A) An automatic stay 
B) A proof of claim 
C) A voluntary petition 
D) A discharge statement

Question 15

Link negligently ran his car into John,causing $50,000 in injuries.Link was intoxicated at the time of the accident.Can Link discharge this debt in bankruptcy?

Accepted Answer

A) Yes, claims based on negligence are dischargeable. 
B) Yes, as long as he didn't intend to hit John's car. 
C) No, such claims are not dischargeable in bankruptcy. 
D) No, because Link breached a fiduciary duty. 
A) Yes, claims based on negligence are dischargeable. 
B) Yes, as long as he didn't intend to hit John's car. 
C) No, such claims are not dischargeable in bankruptcy. 
D) No, because Link breached a fiduciary duty.

Question 16

Which of the following is a primary goal of the Bankruptcy Code?

Accepted Answer

A) to preserve as much of the debtor's property as possible 
B) to pay off the debtor's creditors as quickly as possible 
C) to secure debt counseling for the debtor 
D) to keep the debtor from falling behind in payments 
A) to preserve as much of the debtor's property as possible 
B) to pay off the debtor's creditors as quickly as possible 
C) to secure debt counseling for the debtor 
D) to keep the debtor from falling behind in payments

Question 17

In a Chapter 13 bankruptcy,creditors cannot force a debtor into bankruptcy;nor can they vote to confirm or reject a plan of reorganization.

Accepted Answer

A) True 
 B)False

Question 18

The correct order of payment of claims from the debtor's estate would be

Accepted Answer

A) secured claims, priority claims, unsecured claims. 
B) secured claims, unsecured claims, priority claims. 
C) priority claims, secured claims, unsecured claims. 
D) priority claims, unsecured claims, secured claims. 
A) secured claims, priority claims, unsecured claims. 
B) secured claims, unsecured claims, priority claims. 
C) priority claims, secured claims, unsecured claims. 
D) priority claims, unsecured claims, secured claims.

Question 19

The Bankruptcy Code uses the term "debtor" to refer to a person who cannot pay his debts.

Accepted Answer

A) True 
 B)False

Question 20

Iris received a discharge under a Chapter 7 bankruptcy.She cannot receive another discharge under Chapter 7 for at least

Accepted Answer

A) six years after the prior filing. 
B) eight years after the prior filing. 
C) ten years after the prior discharge. 
D) She cannot file another Chapter 7, but could file a Chapter 11 or 13 bankruptcy. 
A) six years after the prior filing. 
B) eight years after the prior filing. 
C) ten years after the prior discharge. 
D) She cannot file another Chapter 7, but could file a Chapter 11 or 13 bankruptcy.

Exam 36: Bankruptcy

Chapters 11 and 13 are liquidation chapters.

Chapter 13 bankruptcy

Peggy's credit card debts are mounting as her costs of insurance and fuel have dramatically increased and her income,from sporadic free-lance jobs,has dropped.Chapter 13 of the Bankruptcy Code will allow her to reorganize her debt while she keeps most of her assets.

When a debtor no longer has an obligation to pay a debt,that debt has been

Under the federal Bankruptcy Code,the exemption amount for the debtor's personal residence is

Individual debtors are allowed to keep some assets in a Chapter 7 bankruptcy.

Karen has filed for bankruptcy.Who has the authority to confirm or reject a plan of payment,and what factors will be considered when deciding whether to approve a repayment plan under Chapter 13?

Creditors of Northern Hydraulics file an involuntary bankruptcy petition against the company and the petition is approved.What is true of Northern Hydraulics?

Francesca cannot serve as a trustee in a bankruptcy case because she is not a lawyer.

Mark and Cynthia work for Bryson Supply Co.If the company files for Chapter 7 bankruptcy before paying their last month of wages and benefits,will they be able to recover anything from the company?

An official acknowledgement that a debtor is under the jurisdiction of the bankruptcy court is called

Chapter 7 bankruptcy is also known as

Grand Lighting Co.has filed a petition for voluntary bankruptcy under Chapter 7 of the Code.Which of the following will prohibit creditors from collecting debts that Grand Lighting incurred before the petition was filed?

Link negligently ran his car into John,causing $50,000 in injuries.Link was intoxicated at the time of the accident.Can Link discharge this debt in bankruptcy?

Which of the following is a primary goal of the Bankruptcy Code?

In a Chapter 13 bankruptcy,creditors cannot force a debtor into bankruptcy;nor can they vote to confirm or reject a plan of reorganization.

The correct order of payment of claims from the debtor's estate would be

The Bankruptcy Code uses the term "debtor" to refer to a person who cannot pay his debts.

Iris received a discharge under a Chapter 7 bankruptcy.She cannot receive another discharge under Chapter 7 for at least

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