Question 1

Which of the following is true about a trustee's duties?

Accepted Answer

A)  He represents the debtor in bankruptcy proceedings. 
B)  He examines the claims filed by various creditors. 
C)  He cannot have the debtor's property appraised. 
D)  He cannot sell the debtor's nonexempt property. 
A)  He represents the debtor in bankruptcy proceedings. 
B)  He examines the claims filed by various creditors. 
C)  He cannot have the debtor's property appraised. 
D)  He cannot sell the debtor's nonexempt property.

Question 2

Under Chapter 13 of the Bankruptcy Act,debtors:

Accepted Answer

A)  can be free of all debts that are not dischargeable under Chapter 7. 
B)  cannot retain more property than is exempt from bankruptcy under state law. 
C)  are free from garnishment of their property by creditors. 
D)  can pay a lesser percentage of debts owed to the creditors than in straight bankruptcy proceedings. 
A)  can be free of all debts that are not dischargeable under Chapter 7. 
B)  cannot retain more property than is exempt from bankruptcy under state law. 
C)  are free from garnishment of their property by creditors. 
D)  can pay a lesser percentage of debts owed to the creditors than in straight bankruptcy proceedings.

Question 3

Which of the following statements is true of Chapter 13 of the Bankruptcy Code?

Accepted Answer

A)  It encourages extensions of credit. 
B)  It does not help debtors to overcome their financial difficulties. 
C)  It reduces the amount of time allowed to repay debts. 
D)  It permits reductions of debts. 
A)  It encourages extensions of credit. 
B)  It does not help debtors to overcome their financial difficulties. 
C)  It reduces the amount of time allowed to repay debts. 
D)  It permits reductions of debts.

Question 4

The court orders relief to a creditor only if:

Accepted Answer

A)  the debtor is generally not paying his or her debts as they become due. 
B)  a custodian is not appointed or does not take possession of the debtor's property. 
C)  the debtor is not involved in a case to establish paternity. 
D)  the creditor wants to enforce a lien against the debtor's property. 
A)  the debtor is generally not paying his or her debts as they become due. 
B)  a custodian is not appointed or does not take possession of the debtor's property. 
C)  the debtor is not involved in a case to establish paternity. 
D)  the creditor wants to enforce a lien against the debtor's property.

Question 5

Which of the following is a valid objection to a discharge in bankruptcy?

Accepted Answer

A)  The debtor has more than 12 creditors and only 7 have filed for involuntary bankruptcy. 
B)  The debtor wants an opportunity to reorganize his or her business. 
C)  The debtor was unaware of embezzlement by his or her financial advisors. 
D)  The debtor is not able to satisfactorily explain the loss in assets. 
A)  The debtor has more than 12 creditors and only 7 have filed for involuntary bankruptcy. 
B)  The debtor wants an opportunity to reorganize his or her business. 
C)  The debtor was unaware of embezzlement by his or her financial advisors. 
D)  The debtor is not able to satisfactorily explain the loss in assets.

Question 6

A voluntary petition in bankruptcy can only be filed by a corporation.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following statements concerning reaffirmation agreements is true?

Accepted Answer

A)  Reaffirmation agreements are unlawful under the Bankruptcy Act. 
B)  Reaffirmation agreements must be made before a discharge in bankruptcy is granted. 
C)  A debtor cannot voluntarily pay any dischargeable obligation without entering into a reaffirmation agreement. 
D)  Reaffirmation agreements cannot be rescinded prior to discharge or within 60 days after filing with the court. 
A)  Reaffirmation agreements are unlawful under the Bankruptcy Act. 
B)  Reaffirmation agreements must be made before a discharge in bankruptcy is granted. 
C)  A debtor cannot voluntarily pay any dischargeable obligation without entering into a reaffirmation agreement. 
D)  Reaffirmation agreements cannot be rescinded prior to discharge or within 60 days after filing with the court.

Question 8

Six months before filing for bankruptcy,Shirley sold her new car to her brother for $100 so that her creditors could not claim it.The market value of the car was $8,000 at the time of the sale.Under these circumstances,the transfer is _____.

Accepted Answer

A)  voidable by the trustee because Shirley did not receive fair consideration for this transfer 
B)  not voidable by the trustee because the transfer occurred 6 months before Shirley filed her bankruptcy petition 
C)  not voidable because the transfer occurred between two relatives 
D)  voidable by the creditors because it was done with intent to defraud the creditors 
A)  voidable by the trustee because Shirley did not receive fair consideration for this transfer 
B)  not voidable by the trustee because the transfer occurred 6 months before Shirley filed her bankruptcy petition 
C)  not voidable because the transfer occurred between two relatives 
D)  voidable by the creditors because it was done with intent to defraud the creditors

Question 9

Which of the following statements is true of bankruptcy judges?

Accepted Answer

A)  If a dispute falls within a core proceeding, the bankruptcy judge can hear and determine the controversy. 
B)  If a dispute is not a core proceeding but involves a state law claim, then the bankruptcy judge can act as the district court judge. 
C)  They are considered to be units of local circuit courts. 
D)  They are considered to be units of the court of appeals. 
A)  If a dispute falls within a core proceeding, the bankruptcy judge can hear and determine the controversy. 
B)  If a dispute is not a core proceeding but involves a state law claim, then the bankruptcy judge can act as the district court judge. 
C)  They are considered to be units of local circuit courts. 
D)  They are considered to be units of the court of appeals.

Question 10

Under the Bankruptcy Code,exemptions are only available to _____.

Accepted Answer

A)  corporations 
B)  loan associations 
C)  individual debtors 
D)  nonprofit organizations 
A)  corporations 
B)  loan associations 
C)  individual debtors 
D)  nonprofit organizations

Question 11

If a creditor owns a debt that is provable and nondischargeable,he or she _____.

Accepted Answer

A)  may participate in the distribution of the debtor's estate 
B)  can recover only the money provided by the bankrupt's discharge 
C)  must not enter into any voluntary agreement with the debtor for discharge of the debt 
D)  needs court approval for reaffirmation of loans 
A)  may participate in the distribution of the debtor's estate 
B)  can recover only the money provided by the bankrupt's discharge 
C)  must not enter into any voluntary agreement with the debtor for discharge of the debt 
D)  needs court approval for reaffirmation of loans

Question 12

In 1986,_____ of the Bankruptcy Code was added to target the financial problems of the family farm.

Accepted Answer

A)  Chapter 7 
B)  Chapter 11 
C)  Chapter 13 
D)  Chapter 12 
A)  Chapter 7 
B)  Chapter 11 
C)  Chapter 13 
D)  Chapter 12

Question 13

An individual may not be granted a discharge if the individual _____.

Accepted Answer

A)  has obtained one within the previous eight years 
B)  submits to the questioning of the creditors 
C)  works for a corporation 
D)  has obtained a loan from a secured creditor 
A)  has obtained one within the previous eight years 
B)  submits to the questioning of the creditors 
C)  works for a corporation 
D)  has obtained a loan from a secured creditor

Question 14

Which of the following statements is true of claims made by creditors?

Accepted Answer

A)  A trustee receives only some of the defenses that a bankrupt person enjoys against claims. 
B)  If the debtor's property is subject to a secured claim of a creditor, that creditor has the first claim to it. 
C)  If a claim is provable, a creditor can participate in the distribution of the assets of the bankruptcy estate. 
D)  Both secured and unsecured creditors are required to file proofs of claims. 
A)  A trustee receives only some of the defenses that a bankrupt person enjoys against claims. 
B)  If the debtor's property is subject to a secured claim of a creditor, that creditor has the first claim to it. 
C)  If a claim is provable, a creditor can participate in the distribution of the assets of the bankruptcy estate. 
D)  Both secured and unsecured creditors are required to file proofs of claims.

Question 15

If a husband and wife involved in bankruptcy cannot decide whether to use the state or the federal exemptions,the state exemptions are deemed elected.

Accepted Answer

A) True 
 B)False

Question 16

Debtors are considered insolvent if they fail to or are unable to pay their debts as they become due.

Accepted Answer

A) True 
 B)False

Question 17

A petition for Chapter 13 proceedings can be initiated by the:

Accepted Answer

A)  voluntary petition of a debtor. 
B)  involuntary petition of creditors. 
C)  trustee. 
D)  secured creditors. 
A)  voluntary petition of a debtor. 
B)  involuntary petition of creditors. 
C)  trustee. 
D)  secured creditors.

Question 18

Under Chapter 11 of the Bankruptcy Act,a reorganization plan:

Accepted Answer

A)  must set forth how each creditor will be satisfied. 
B)  need not state which claims are impaired or adversely affected by the plan. 
C)  need not treat all creditors in a given class the same. 
D)  must give creditors and trustees shares in the corporation in exchange for the debt owed to them. 
A)  must set forth how each creditor will be satisfied. 
B)  need not state which claims are impaired or adversely affected by the plan. 
C)  need not treat all creditors in a given class the same. 
D)  must give creditors and trustees shares in the corporation in exchange for the debt owed to them.

Question 19

Involuntary petitions in straight bankruptcy can be filed against:

Accepted Answer

A)  banking corporations and credit unions. 
B)  savings and loan associations. 
C)  a debtor engaged in business. 
D)  a nonprofit organization. 
A)  banking corporations and credit unions. 
B)  savings and loan associations. 
C)  a debtor engaged in business. 
D)  a nonprofit organization.

Question 20

Which of the following statements is true of Chapter 11 of the Bankruptcy Code?

Accepted Answer

A)  It provides a proceeding whereby the debtor's financial affairs can be liquidated rather than reorganized. 
B)  Unlike Chapter 13, in Chapter 11 cases, the debt is predominately nonconsumer debt. 
C)  Petitions for Chapter 11 cases cannot be filed voluntarily by the debtor. 
D)  The reorganization plan is essentially a contract between a debtor and its trustees. 
A)  It provides a proceeding whereby the debtor's financial affairs can be liquidated rather than reorganized. 
B)  Unlike Chapter 13, in Chapter 11 cases, the debt is predominately nonconsumer debt. 
C)  Petitions for Chapter 11 cases cannot be filed voluntarily by the debtor. 
D)  The reorganization plan is essentially a contract between a debtor and its trustees.

Exam 44: Bankruptcy-Part Nine Government Regulation

Which of the following is true about a trustee's duties?

Under Chapter 13 of the Bankruptcy Act,debtors:

Which of the following statements is true of Chapter 13 of the Bankruptcy Code?

The court orders relief to a creditor only if:

Which of the following is a valid objection to a discharge in bankruptcy?

A voluntary petition in bankruptcy can only be filed by a corporation.

Which of the following statements concerning reaffirmation agreements is true?

Six months before filing for bankruptcy,Shirley sold her new car to her brother for $100 so that her creditors could not claim it.The market value of the car was $8,000 at the time of the sale.Under these circumstances,the transfer is _____.

Which of the following statements is true of bankruptcy judges?

Under the Bankruptcy Code,exemptions are only available to _____.

If a creditor owns a debt that is provable and nondischargeable,he or she _____.

In 1986,_____ of the Bankruptcy Code was added to target the financial problems of the family farm.

An individual may not be granted a discharge if the individual _____.

Which of the following statements is true of claims made by creditors?

If a husband and wife involved in bankruptcy cannot decide whether to use the state or the federal exemptions,the state exemptions are deemed elected.

Debtors are considered insolvent if they fail to or are unable to pay their debts as they become due.

A petition for Chapter 13 proceedings can be initiated by the:

Under Chapter 11 of the Bankruptcy Act,a reorganization plan:

Involuntary petitions in straight bankruptcy can be filed against:

Which of the following statements is true of Chapter 11 of the Bankruptcy Code?

Law, Legal Reasoning, and the Legal Profession

Dispute Settlement

Business Ethics and Corporate Social Responsibility

Business and the Constitution

Crimes

Intentional Torts

Negligence and Strict Liability

Licensing and Intellectual Propertypart Two Contracts

The Nature and Origins of Contracts

Creating a Contract: Offers

Creating a Contract: Acceptances

Consideration

Capacity to Contract

Voluntary Consent

Illegality

The Form and Meaning of Contracts

Third Parties Contract Rights

Performance and Remediespart Three Sales

Formation and Terms of Sales Contracts

Warranties and Product Liability

Performance of Sales Contracts

Remedies for Breach of Sales Contractspart Four Agency and Employment

The Agency Relationship-Creation, duties, and Termination

Liability of Principals and Agents to Third Parties

Employment Laws-Part Five Business Organizations

Which Form of Business Organization

Partnerships

Formation and Termination of Corporations

Management of the Corporate Business

Financing the Corporation and the Role of the Shareholders

Securities Regulation

Legal Liability of Accountantspart Six Property

Personal Property and Bailments

Real Property

Landlord and Tenant

Estates and Trusts

Insurance-Part Seven Commercial Paper

Negotiable Instruments

Negotiation and Holder in Due Course

Liability of Parties

Checks and Electronic Fund Transfers-Part Eight Credit Transactions

Introduction to Security

Security Interests in Personal Property

The Antitrust Laws

Consumer Protection Laws

Environmental Regulation

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