Which One of the Following Statements Concerning Bankruptcy Is Correct

Multiple Choice

Which one of the following statements concerning bankruptcy is correct?

A) An indirect cost of bankruptcy is the loss of key employees.
B) Bondholders have a greater incentive than stockholders to keep a firm from filing for bankruptcy.
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.