Exam 34: Bankruptcy

Nonprofit corporations are exempt from involuntary bankruptcy proceedings.

A voluntary petition in bankruptcy may not be filed by any of the following except a(n): ______.

A(n) ______ is a written statement, signed by the creditor or an authorized representative, setting forth any claim made against the debtor and the basis for it.

The filing of a bankruptcy petition operates as a(n) ______, which prevents creditors from taking action, such as filing suits or foreclosure actions, against the debtor.13

The filing of a voluntary, but not an involuntary, petition operates as an automatic stay.

Costs and expenses of administration of the bankruptcy case, including trustee fees are paid before any money is disbursed to secured or unsecured creditors.

Which of the following is a correct legal conclusion regarding Chapter 11 reorganization bankruptcy?

A creditor must only file a proof of claim if the bankruptcy trustee does not know of the existence of the claim.

In a Chapter 7 bankruptcy, the debtor's nonexempt assets are liquidated to pay debts.

Stockbrokers are eligible to file Chapter 11 bankruptcy.

Under the Bankruptcy Reform Act, the "mansion loophole" increases the homestead exemption for debtors.

Individuals and corporations, but not partnerships, may be reorganized under the Bankruptcy Code.

Which of the following debts is not dischargeable in bankruptcy?

A discharge does not release a person from a consumer debt to a single creditor totaling more than $5,775 for luxury goods or services if the debt was incurred within how many days of the order for relief?

None of the following transfers may be set aside as preferences by the bankruptcy trustee except for: ______.

In a Chapter 11 rehabilitation plan, the debtor is able to do all of the following except:

A transfer of property by a debtor within ______ prior to filing with the intent to hinder, delay, or defraud creditors is called a(n) ______.

A debtor is presumed to be insolvent on and during what number of days immediately preceding the date of the filing of a bankruptcy petition?

If the debtor is generally not paying debts as they become due, the debtor may be subject to an involuntary bankruptcy petition.

The creditors of Sara Delano have petitioned for involuntary bankruptcy proceedings against her. Delano has been consistently late in paying her obligations for the past year. Two months before the petition was filed, a custodian was appointed to protect Delano's property. In her statement contesting the bankruptcy petition, Delano pointed out that she had dealt in good faith and could not be shown to be guilty of any act of misconduct. In addition, she cited her willingness to allow a custodian to be appointed as an indication of her intention to avoid bankruptcy and honor her obligations. Can she prevail?