Question 1

Under Chapter 13, after the completion of all payments under the plan, the court will grant a discharge of

Accepted Answer

A)   only the debts provided for by the plan.
B)   only the obligations not provided for by the plan.
C)   all claims, whether or not provided for by the plan.
D)   all obligations that remain unsatisfied.E) A) and B)
F) A) and C)

Question 2

Once a petition is properly filed, creditors can commence or continue most legal actions against the debtor to recover claims.

Accepted Answer

A) True 
 B)False

Question 3

Under Chapter 13, all debts are dischargeable.

Accepted Answer

A) True 
 B)False

Question 4

Baby Day Care, a sole proprietorship, has $150,000 in debt and wants to pay as many of its obligations as reasonably possible. It wishes to be discharged of any remaining debt it cannot pay. To accomplish this goal, the proprietorship should file a petition in bankruptcy under Chapter 13 for relief through

Accepted Answer

A)   a liquidation.
B)   a reorganization.
C)   a repayment plan.
D)   an automatic stay.E) None of the above
F) A) and B)

Question 5

In a Chapter 7 proceeding, secured creditors' claims have priority over the claims of unsecured creditors.

Accepted Answer

A) True 
 B)False

Question 6

A voluntary petition in bankruptcy must include

Accepted Answer

A)   proof of each creditor's claim.
B)   a list of creditors and the amount of the debt owed to each.
C)   a future plan for increasing the debtor's income.
D)   a statement indicating that the debtor understands basic economics.E) A) and B)
F) A) and C)

Question 7

Under Chapter 11, a business debtor's obligations most likely to remain and not be discharged include

Accepted Answer

A)   taxes accruing within the last three years.
B)   debt accrued in the last three years for supplies.
C)   debt owed for a conference the business held.
D)   debt on a fleet of vehicles.E) B) and C)
F) A) and B)

Question 8

Under Chapter 7, the primary effect of a discharge is to

Accepted Answer

A)   extend the time for the debtor's payment of overdue debts.
B)   allow a creditor to collect a previous judgment on a discharged debt.
C)   force a creditor to obtain a new judgment on a discharged debt.
D)   void a judgment on a discharged debt and prohibit an action to collect it.E) None of the above
F) All of the above

Question 9

Under Chapter 7 and Chapter 11

Accepted Answer

A)   a repayment plan is developed by the debtor .
B)   petitions can be filed voluntarily or involuntarily.
C)   the entry of the order for relief is based on different criteria .
D)   applies trustee oversees all of the debtor's assets .E) A) and B)
F) A) and C)

Question 10

Chapter 7 of the Bankruptcy Code provides for

Accepted Answer

A)   the adjustment of debts of individuals-not businesses .
B)   liquidation proceedings.
C)   the reorganization of the obligations of the debtor .
D)   the adjustment of debts of businesses-not individuals .E) B) and D)
F) All of the above

Question 11

Debtors may be forced into involuntary bankruptcy by creditors even though their assets far exceed their liabilities.

Accepted Answer

A) True 
 B)False

Question 12

Voluntary petitions may be filed to initiate Chapter 7 or Chapter 11, but not Chapter 13, bankruptcies.

Accepted Answer

A) True 
 B)False

Question 13

T he bankruptcy trustee in a Chapter 7 proceeding is accountable for administering the debtor's estate.

Accepted Answer

A) True 
 B)False  True

Question 14

In a Chapter 13 bankruptcy, debtors retain most of their assets and agree to payments on their debts, most of which are discharged within three years.

Accepted Answer

A) True 
 B)False

Question 15

Dana operates Energy Inc., a corporation in the fuel-supply business. Dana wants to create a plan under which the firm pays a portion of its debts, is discharged of the remainder, and is allowed to continue in business. Energy should file a petition in bankruptcy for relief through

Accepted Answer

A)   a liquidation.
B)   a reorganization.
C)   a repayment plan.
D)   an adjustment of debts.E) All of the above
F) A) and B)

Question 16

Chapter 7 bankruptcy is reserved for any natural person.

Accepted Answer

A) True 
 B)False

Question 17

eGear is a retail seller of consumer electronic equipment. eGear sells Fiona a $2,400 television set on credit. Fiona pays $100 down and agrees to pay the balance in equal installments. eGear retains a security interest in the set. Two months later, Fiona defaults on the payments to eGear and is involuntarily petitioned into bankruptcy by other creditors. Discuss eGear's right to repossess the TV set or to be paid on the debt.

Accepted Answer

eGear will not be able to repossess the set. The filing of the involuntary petition in bankruptcy operates as an automatic stay of any creditor's action against the debtor or the property of the debtor. If eGear violates the automatic stay, eGear could be liable to any injured party. Therefore, eGear's right of repossession is cut off by the bankruptcy proceeding. 
eGear's right to be paid on the debt depends on its status as a secured creditor.   A secured creditor has a security interest in collateral that secures the debt. The bankruptcy trustee will evaluate the bankruptcy estate and will assess proofs of claim. eGear will have to provide proof that it is a secured creditor with the set as collateral. The trustee may surrender the set to eGear as part of the property distribution. eGear can enforce the security interest either by accepting the property in full satisfaction of the debt or by selling the collateral and using the proceeds to pay off the debt. Should the collateral be insufficient to cover the secured debt owed, the secured creditor becomes an unsecured creditor for the difference. 
Here, eGear is a perfected secured party, and on a sale of the set, eGear is thus entitled to the proceeds up to the amount of balance of the debt.

Question 18

Only the debtor may file a plan under Chapter 13.

Accepted Answer

A) True 
 B)False  True

Question 19

To qualify under Chapter 7, a debtor must complete a means test to determine whether the debtor has been living within his or her means.

Accepted Answer

A) True 
 B)False

Question 20

Under Chapter 7, to be entitled to receive a portion of a debtor's estate, each creditor must file a proof of claim with the bankruptcy court within ninety days of

Accepted Answer

A)   the order for relief.
B)   the petition.
C)   the automatic stay.
D)   the creditors' meeting.E) A) and C)
F) B) and D)

Exam 34: Bankruptcy

Under Chapter 13, after the completion of all payments under the plan, the court will grant a discharge of

Correct Answer
verified

Once a petition is properly filed, creditors can commence or continue most legal actions against the debtor to recover claims.

Correct Answer
verified

Under Chapter 13, all debts are dischargeable.

Correct Answer
verified

Correct Answer
verified

In a Chapter 7 proceeding, secured creditors' claims have priority over the claims of unsecured creditors.

Correct Answer
verified

A voluntary petition in bankruptcy must include

Correct Answer
verified

Under Chapter 11, a business debtor's obligations most likely to remain and not be discharged include

Correct Answer
verified

Under Chapter 7, the primary effect of a discharge is to

Correct Answer
verified

Under Chapter 7 and Chapter 11

Correct Answer
verified

Chapter 7 of the Bankruptcy Code provides for

Correct Answer
verified

Debtors may be forced into involuntary bankruptcy by creditors even though their assets far exceed their liabilities.

Correct Answer
verified

Voluntary petitions may be filed to initiate Chapter 7 or Chapter 11, but not Chapter 13, bankruptcies.

Correct Answer
verified

T he bankruptcy trustee in a Chapter 7 proceeding is accountable for administering the debtor's estate.

Correct Answer
verified
True

In a Chapter 13 bankruptcy, debtors retain most of their assets and agree to payments on their debts, most of which are discharged within three years.

Correct Answer
verified

Dana operates Energy Inc., a corporation in the fuel-supply business. Dana wants to create a plan under which the firm pays a portion of its debts, is discharged of the remainder, and is allowed to continue in business. Energy should file a petition in bankruptcy for relief through

Correct Answer
verified

Chapter 7 bankruptcy is reserved for any natural person.

Correct Answer
verified

Only the debtor may file a plan under Chapter 13.

Correct Answer
verified
True

To qualify under Chapter 7, a debtor must complete a means test to determine whether the debtor has been living within his or her means.

Correct Answer
verified

Under Chapter 7, to be entitled to receive a portion of a debtor's estate, each creditor must file a proof of claim with the bankruptcy court within ninety days of

Correct Answer
verified

Exam 34: Bankruptcy

Under Chapter 13, after the completion of all payments under the plan, the court will grant a discharge of

Correct AnswerverifiedShow Answer

Once a petition is properly filed, creditors can commence or continue most legal actions against the debtor to recover claims.

Correct AnswerverifiedShow Answer

Under Chapter 13, all debts are dischargeable.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

In a Chapter 7 proceeding, secured creditors' claims have priority over the claims of unsecured creditors.

Correct AnswerverifiedShow Answer

A voluntary petition in bankruptcy must include

Correct AnswerverifiedShow Answer

Under Chapter 11, a business debtor's obligations most likely to remain and not be discharged include

Correct AnswerverifiedShow Answer

Under Chapter 7, the primary effect of a discharge is to

Correct AnswerverifiedShow Answer

Under Chapter 7 and Chapter 11

Correct AnswerverifiedShow Answer

Chapter 7 of the Bankruptcy Code provides for

Correct AnswerverifiedShow Answer

Debtors may be forced into involuntary bankruptcy by creditors even though their assets far exceed their liabilities.

Correct AnswerverifiedShow Answer

Voluntary petitions may be filed to initiate Chapter 7 or Chapter 11, but not Chapter 13, bankruptcies.

Correct AnswerverifiedShow Answer

T he bankruptcy trustee in a Chapter 7 proceeding is accountable for administering the debtor's estate.

Correct AnswerverifiedTrue

In a Chapter 13 bankruptcy, debtors retain most of their assets and agree to payments on their debts, most of which are discharged within three years.

Correct AnswerverifiedShow Answer

Dana operates Energy Inc., a corporation in the fuel-supply business. Dana wants to create a plan under which the firm pays a portion of its debts, is discharged of the remainder, and is allowed to continue in business. Energy should file a petition in bankruptcy for relief through

Correct AnswerverifiedShow Answer

Chapter 7 bankruptcy is reserved for any natural person.

Correct AnswerverifiedShow Answer

Only the debtor may file a plan under Chapter 13.

Correct AnswerverifiedTrue

To qualify under Chapter 7, a debtor must complete a means test to determine whether the debtor has been living within his or her means.

Correct AnswerverifiedShow Answer

Under Chapter 7, to be entitled to receive a portion of a debtor's estate, each creditor must file a proof of claim with the bankruptcy court within ninety days of

Correct AnswerverifiedShow Answer

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True

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True

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