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Pamela Plans to File for Bankruptcy Under Chapter 7

Question 2

Multiple Choice

Pamela plans to file for bankruptcy under Chapter 7.One month before filing,Pamela gives Marshall's Filling Station $500 to apply to her gas bill,since Marshall has been so kind to let her charge the gas she needed for her car over the past year.The bankruptcy trustee:


A) can cancel the payment to Marshall as a fraudulent transfer.
B) cannot cancel the payment to Marshall because it is payment for an existing debt.
C) cannot cancel the payment to Marshall because he is not an insider.
D) can cancel the payment to Marshall as a voidable preference.

Correct Answer:

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