Question 1

It is simpler to sell a business if the business structure is a:

Accepted Answer

A) company. 
B) sole trader. 
C) trust. 
D) partnership. 
A) company. 
B) sole trader. 
C) trust. 
D) partnership.

Question 2

'Winding up' is a statutory process whereby:

Accepted Answer

A) a receiver is appointed to manage a business in a way that will enable it to repay the debt owed to the business's creditor by whom they were appointed. 
B) an insolvent individual's assets are sold to repay their creditors. 
C) an insolvent company's assets are sold to repay the company's creditors. 
D) an insolvent business's assets are sold to repay the business' creditors. 
A) a receiver is appointed to manage a business in a way that will enable it to repay the debt owed to the business's creditor by whom they were appointed. 
B) an insolvent individual's assets are sold to repay their creditors. 
C) an insolvent company's assets are sold to repay the company's creditors. 
D) an insolvent business's assets are sold to repay the business' creditors.

Question 3

A 'partnership at will' is:

Accepted Answer

A) an open ended partnership that will not expire after a fixed period of time. 
B) a single transaction partnership. 
C) an ad hoc partnership. 
D) a partnership formed in a will or other testamentary instrument. 
A) an open ended partnership that will not expire after a fixed period of time. 
B) a single transaction partnership. 
C) an ad hoc partnership. 
D) a partnership formed in a will or other testamentary instrument.

Question 4

The idea that a bankruptcy is deemed to have commenced on the date of the first Act of bankruptcy within the 6 months prior to the presentation of the creditor's petition is a statement of the doctrine of:

Accepted Answer

A) relation back. 
B) sequestration. 
C) voidable transactions. 
D) unfair preferences. 
A) relation back. 
B) sequestration. 
C) voidable transactions. 
D) unfair preferences.

Question 5

Which of the following is not a usual consequence of bankruptcy for the bankrupt person?

Accepted Answer

A) The person will remain bankrupt for a minimum of 10 years. 
B) The person's name will be on the public bankruptcy record. 
C) The person will usually be obliged to advise providers of credit that they are bankrupt. 
D) The person will be prohibited from managing a company or from holding public positions without permission. 
A) The person will remain bankrupt for a minimum of 10 years. 
B) The person's name will be on the public bankruptcy record. 
C) The person will usually be obliged to advise providers of credit that they are bankrupt. 
D) The person will be prohibited from managing a company or from holding public positions without permission.

Question 6

Which of the following legal entities, if insolvent, may be 'liquidated'?

Accepted Answer

A) A sole trader 
B) A partnership 
C) A company 
D) Any form of business 
A) A sole trader 
B) A partnership 
C) A company 
D) Any form of business

Question 7

The basic stages in the process of selling a business do not usually include:

Accepted Answer

A) deregistration. 
B) valuation. 
C) due diligence. 
D) settlement. 
A) deregistration. 
B) valuation. 
C) due diligence. 
D) settlement.

Question 8

In the context of bankruptcy law, 'voidable transactions' include:

Accepted Answer

A) free or less than market value property transfers to non-related entities in the two years prior to bankruptcy. 
B) all transfers of property made in the five years prior to the bankruptcy if the transferee is unable to prove that the bankrupt was insolvent at the time. 
C) transfers of property made to relatives or friends for consideration less than market value within the four years prior to bankruptcy. 
D) transfers of property that were made when the bankrupt was solvent that have the effect of giving a creditor an unfair preference. 
A) free or less than market value property transfers to non-related entities in the two years prior to bankruptcy. 
B) all transfers of property made in the five years prior to the bankruptcy if the transferee is unable to prove that the bankrupt was insolvent at the time. 
C) transfers of property made to relatives or friends for consideration less than market value within the four years prior to bankruptcy. 
D) transfers of property that were made when the bankrupt was solvent that have the effect of giving a creditor an unfair preference.

Question 9

A trust comes to an end:

Accepted Answer

A) when the trustee retires, dies, becomes incapacitated or is for any other reason unable to discharge their duties as trustee. 
B) automatically, once the trustee has distributed all of the trust property to the beneficiaries in accordance with the trust. 
C) whenever the beneficiaries choose to end it. 
D) only by court order. 
A) when the trustee retires, dies, becomes incapacitated or is for any other reason unable to discharge their duties as trustee. 
B) automatically, once the trustee has distributed all of the trust property to the beneficiaries in accordance with the trust. 
C) whenever the beneficiaries choose to end it. 
D) only by court order.

Question 10

How does liquidation differ from bankruptcy?

Accepted Answer

A) They are the same thing. 
B) Companies are liquidated; individuals are made bankrupt. 
C) Liquidation is not a formal legal process whereas bankruptcy is. 
D) All businesses can be liquidated but not all business can be made bankrupt. 
A) They are the same thing. 
B) Companies are liquidated; individuals are made bankrupt. 
C) Liquidation is not a formal legal process whereas bankruptcy is. 
D) All businesses can be liquidated but not all business can be made bankrupt.

Question 11

To qualify to make a creditor's petition, which of the following requirements need not be satisfied?

Accepted Answer

A) The creditor needs to be owed the statutory minimum amount of money. 
B) The debtor must have committed an 'act of bankruptcy'. 
C) The act of bankruptcy must have occurred within the last 6 months. 
D) The creditor making the petition must be a secured creditor. 
A) The creditor needs to be owed the statutory minimum amount of money. 
B) The debtor must have committed an 'act of bankruptcy'. 
C) The act of bankruptcy must have occurred within the last 6 months. 
D) The creditor making the petition must be a secured creditor.

Question 12

What is the legal effect of the death of a partner?

Accepted Answer

A) The partnership comes to an end. 
B) The partnership remains unchanged. 
C) The partnership becomes illegal. 
D) The partnership is wound up. 
A) The partnership comes to an end. 
B) The partnership remains unchanged. 
C) The partnership becomes illegal. 
D) The partnership is wound up.

Question 13

What should the secured creditor of a company do when the company is being wound up?

Accepted Answer

A) Sell the security 
B) Forgive the debt 
C) Negotiate a debt repayment plan 
D) Appoint a receiver 
A) Sell the security 
B) Forgive the debt 
C) Negotiate a debt repayment plan 
D) Appoint a receiver

Question 14

In the context of bankruptcy laws, an 'unfair preference' is:

Accepted Answer

A) the payment by a debtor of amounts owed to one creditor at the expense of the other creditors. 
B) a payment of money by the bankrupt to a person with a close connection to the bankrupt individual (e.g.a partner, spouse or child) in the four years prior to bankruptcy. 
C) any voidable transaction. 
D) a transfer of property or payment to a related entity in the four years prior to bankruptcy. 
A) the payment by a debtor of amounts owed to one creditor at the expense of the other creditors. 
B) a payment of money by the bankrupt to a person with a close connection to the bankrupt individual (e.g.a partner, spouse or child) in the four years prior to bankruptcy. 
C) any voidable transaction. 
D) a transfer of property or payment to a related entity in the four years prior to bankruptcy.

Question 15

Trustees in bankruptcy have extensive powers, but they cannot request the official receiver to:

Accepted Answer

A) personally release the bankrupt from particular debts where not to do so would be harsh and oppressive to the bankrupt. 
B) summons a person to produce documents relating to the bankrupts affairs. 
C) summons a person to give evidence relating to the bankrupt. 
D) issue a search warrant providing access to premises and books relevant to the bankruptcy. 
A) personally release the bankrupt from particular debts where not to do so would be harsh and oppressive to the bankrupt. 
B) summons a person to produce documents relating to the bankrupts affairs. 
C) summons a person to give evidence relating to the bankrupt. 
D) issue a search warrant providing access to premises and books relevant to the bankruptcy.

Question 16

What is the difference between a Part X personal insolvency agreement and a Part IX debt agreement?

Accepted Answer

A) Only a Part X agreement is a true alternative to bankruptcy 
B) The Part X agreement caters to larger estates than the Part IX agreement 
C) The Part IX agreement costs more to set up than the Part X agreement 
D) Only the Part IX agreement is lawful 
A) Only a Part X agreement is a true alternative to bankruptcy 
B) The Part X agreement caters to larger estates than the Part IX agreement 
C) The Part IX agreement costs more to set up than the Part X agreement 
D) Only the Part IX agreement is lawful

Question 17

An insolvent company may be subjected to:

Accepted Answer

A) a Part X agreement. 
B) a Part IX arrangement. 
C) liquidation. 
D) bankruptcy. 
A) a Part X agreement. 
B) a Part IX arrangement. 
C) liquidation. 
D) bankruptcy.

Question 18

A 'sequestration order' is an order of the Court declaring:

Accepted Answer

A) an individual to be bankrupt. 
B) a business to be under receivership. 
C) the appointment of a liquidator to wind up a company. 
D) the deregistration of a company. 
A) an individual to be bankrupt. 
B) a business to be under receivership. 
C) the appointment of a liquidator to wind up a company. 
D) the deregistration of a company.

Question 19

A person is insolvent when:

Accepted Answer

A) they believe that they may not be able to pay all their debts. 
B) they owe more money to creditors than they have in the bank. 
C) they are unable to pay their debts as and when they become due and payable. 
D) they make a loss three years in a row. 
A) they believe that they may not be able to pay all their debts. 
B) they owe more money to creditors than they have in the bank. 
C) they are unable to pay their debts as and when they become due and payable. 
D) they make a loss three years in a row.

Question 20

What is the main objective of a receiver?

Accepted Answer

A) To better manage a business and get it out of trouble. 
B) To sell the assets of a business and generate as much money as possible. 
C) To manage a business and deal with its assets in a way that will enable it to repay a debt owed to the creditor by whom they were appointed. 
D) To wind up the business. 
A) To better manage a business and get it out of trouble. 
B) To sell the assets of a business and generate as much money as possible. 
C) To manage a business and deal with its assets in a way that will enable it to repay a debt owed to the creditor by whom they were appointed. 
D) To wind up the business.

It is simpler to sell a business if the business structure is a:

'Winding up' is a statutory process whereby:

A 'partnership at will' is:

The idea that a bankruptcy is deemed to have commenced on the date of the first Act of bankruptcy within the 6 months prior to the presentation of the creditor's petition is a statement of the doctrine of:

Which of the following is not a usual consequence of bankruptcy for the bankrupt person?

Which of the following legal entities, if insolvent, may be 'liquidated'?

The basic stages in the process of selling a business do not usually include:

In the context of bankruptcy law, 'voidable transactions' include:

A trust comes to an end:

How does liquidation differ from bankruptcy?

To qualify to make a creditor's petition, which of the following requirements need not be satisfied?

What is the legal effect of the death of a partner?

What should the secured creditor of a company do when the company is being wound up?

In the context of bankruptcy laws, an 'unfair preference' is:

Trustees in bankruptcy have extensive powers, but they cannot request the official receiver to:

What is the difference between a Part X personal insolvency agreement and a Part IX debt agreement?

An insolvent company may be subjected to:

A 'sequestration order' is an order of the Court declaring:

A person is insolvent when:

What is the main objective of a receiver?

Business and the Law

The Australian Legal System

Politicians and Judges

How to Find, Understand and Use the Law

Deliberately Causing Harm

Carelessly Causing Harm

Contract Law: Formation of the Contract

Contract Law: Terms of the Contract

Contract Law: Enforcement of the Contract

Contract Law: Working With Agents

Dealing With Consumers

Dealing With Competitors

Protecting Ip

Managing a Business: Start-Up

Managing a Business: Business Ownership

Managing a Business: Companies and Corporate Governance

Managing a Business: Making Payments and Recovering Debts

Managing a Business: Insurance and Taxes

Managing a Business: Employing Workers

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Exam 20: Managing a Business: Closing Down

It is simpler to sell a business if the business structure is a:

'Winding up' is a statutory process whereby:

A 'partnership at will' is:

The idea that a bankruptcy is deemed to have commenced on the date of the first Act of bankruptcy within the 6 months prior to the presentation of the creditor's petition is a statement of the doctrine of:

Which of the following is not a usual consequence of bankruptcy for the bankrupt person?

Which of the following legal entities, if insolvent, may be 'liquidated'?

The basic stages in the process of selling a business do not usually include:

In the context of bankruptcy law, 'voidable transactions' include:

A trust comes to an end:

How does liquidation differ from bankruptcy?

To qualify to make a creditor's petition, which of the following requirements need not be satisfied?

What is the legal effect of the death of a partner?

What should the secured creditor of a company do when the company is being wound up?

In the context of bankruptcy laws, an 'unfair preference' is:

Trustees in bankruptcy have extensive powers, but they cannot request the official receiver to:

What is the difference between a Part X personal insolvency agreement and a Part IX debt agreement?

An insolvent company may be subjected to:

A 'sequestration order' is an order of the Court declaring:

A person is insolvent when:

What is the main objective of a receiver?

Business and the Law

The Australian Legal System

Politicians and Judges

How to Find, Understand and Use the Law

Deliberately Causing Harm

Carelessly Causing Harm

Contract Law: Formation of the Contract

Contract Law: Terms of the Contract

Contract Law: Enforcement of the Contract

Contract Law: Working With Agents

Dealing With Consumers

Dealing With Competitors

Protecting Ip

Managing a Business: Start-Up

Managing a Business: Business Ownership

Managing a Business: Companies and Corporate Governance

Managing a Business: Making Payments and Recovering Debts

Managing a Business: Insurance and Taxes

Managing a Business: Employing Workers

Filters