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Fact Pattern 30-1B In January,Jazz Dance Studio Owes Kay,its Musical Director,$1,800 for Cur?rent

Question 18

Multiple Choice

Fact Pattern 30-1B
In January,Jazz Dance Studio owes Kay,its musical director,$1,800 for cur?rent wages,receives $700 as a down payment for dance lessons from Lora,and pays a Music,Inc. ,a sheet music supplier,$1,500 of $3,000 owed.In February,the studio files a petition in bankruptcy for relief through a liquidation.
-Refer to Fact Pattern 30-1B.Based on the size of the studio's estate in bank?ruptcy,each of Jazz's creditors will get only 10 percent of their claims.Regarding the payment to Music,Inc. ,the trustee may


A) not recover it because Music's claim has priority.
B) not recover it unless Music is an in?sider.
C) recover it as a fraudulent transfer.
D) recover it as a voidable preference.

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