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Exam 9: Selecting the Appropriate Type of Bankruptcy Fling

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Question 1

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Why would an individual debtor who operates a business prefer to reorganize under Chapter 13 rather than Chapter 11?

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The cost of reorganizing under...

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Question 2

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The fair-and-equitable test does not apply in Chapter 11 cases for individual debtors.

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Question 3

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The greatest number of bankruptcy filings are ____.

Domestic insurance companies and banks may not be debtors under the Bankruptcy Code.

The operative chapter of the Bankruptcy Code for liquidation is ____.

If a debtor operates a business and either is unable to reorganize or does not want to reorganize, the bankruptcy options are a Chapter ________ or a Chapter _________.

For a nonbusiness debtor, discuss the factors that relate to the selection of the operative chapter of the Bankruptcy Code under which the case is filed. Include in your discussion eligibility as well as other factors.

The debtor that operates a business is eligible to file for bankruptcy under Chapters 11, 12, and 13.

An individual debtor may not receive a discharge under Chapter 11 until all plan payments have been made.

All business debtors except railroads, insurance companies, banks, savings and loan associations, and credit unions are eligible for Chapter 7.

An individual business debtor may file under Chapter 13.

An individual nonbusiness debtor may file under Chapter 11.

In the calendar year ending December 31, 2004, the number of bankruptcy cases filed in the 94 bankruptcy courts across the country was ____.

All farmers are eligible to be debtors under Chapter 12.

For a business debtor, discuss the factors that relate to the selection of the operative chapter of the Bankruptcy Code under which the case is filed. Include in your discussion eligibility as well as other factors.

Although railroads are only eligible for Chapter 11 and stockbrokers and commodity brokers are only eligible for Chapter 7, all other business debtors are eligible to file under either Chapter 7 or Chapter 11.

Explain why business debtors seldom select Chapter 7.

Not all debtors are eligible to file under all the operative chapters of the Bankruptcy Code.

Name three remedies available to a debtor under Chapter 13 that are not available under Chapter 7.

Explain why a business debtor may choose to liquidate under Chapter 11 rather than under Chapter 7.