Which One of the Following Statements Concerning Bankruptcy Is Correct

Multiple Choice

Which one of the following statements concerning bankruptcy is correct?

A) Bondholders have a greater incentive than stockholders to keep a firm from filing for bankruptcy.
B) An indirect cost of bankruptcy is the loss of key employees.
C) Bankruptcy is sometimes used as a means to increase payroll costs.
D) The assets of a firm tend to increase in value when a firm is in financial distress.
E) The administrative costs incurred in a bankruptcy are considered indirect bankruptcy costs.