Exam 32: Bankruptcy and Reorganization

A) Bankruptcy Act of 1898
B) Insolvency Act of 1900
C) Protection Act of 1934
D) Bankruptcy Act of 1934
E) Securities Act of 1934

Correct Answer

verified

Show Answer

A) Under the act, an individual may not generally be considered a debtor unless within 180 days prior to filing, the debtor receives credit counseling from a nonprofit budget and credit counseling agency.
B) Under the act, if an individual was a debtor in a bankruptcy case that was dismissed within 180 days of the current case, the individual is generally not eligible to be a debtor under Chapters 7, 11, or 13.
C) Under the act, if a previous bankruptcy was completed rather than dismissed, the individual is generally permitted to file for bankruptcy again.
D) Under the act if a party completes a Chapter 7 bankruptcy, the party is not permitted to seek a Chapter 7 bankruptcy again for eight years.
E) Under the act if a party has at least $10,000 in assets, the party may not file for any type of bankruptcy protection.

Correct Answer

verified

Show Answer

A) It will likely be allowed because the value claimed is within the federal exemption allowed.
B) It will likely be allowed because although it is more than the federal exemption, no creditor filed an objection to it.
C) It will likely be disallowed because the federal limit for an exemption for a residence is $10,000.
D) It will likely be disallowed because the federal limit for an exemption for a residence is $5,000.
E) The status of the exemption is unclear without further information regarding the resale value of the home.

Correct Answer

verified

Show Answer

A) The means test
B) The assets test
C) The median test
D) The liquidation test
E) The bankruptcy test

Correct Answer

verified

Show Answer

A) A family farmer under Chapter 12 must have regular annual income.
B) The family farmer's gross income must be at least 50 percent farm-dependent.
C) At least 50 percent of the family farmer's debt must be farm-related.
D) The debt must be under a certain debt cap.
E) Congress modeled Chapter 12 after Chapter 7 relief.

Correct Answer

verified

Show Answer

Correct Answer

verified

Show Answer

A) Liquidation
B) Reorganization
C) Reformation
D) Acknowledgment
E) Avoidance

Correct Answer

verified

Show Answer

A) The payment was not preferential because it was made over 90 days before the filing of the bankruptcy petition.
B) The payment was not preferential because it was made over 120 days before the filing of the bankruptcy petition.
C) The payment was not preferential because it was made over 180 days before the filing of the bankruptcy petition.
D) The payment was preferential because it was made to a family member and made within two years of the filing of the bankruptcy petition unless Mindy can establish that she was not insolvent when she made the payment.
E) The payment was preferential on the basis that it was made to a family member within two years of the filing of the bankruptcy petition only if the trustee is able to demonstrate that Mindy was insolvent when she made the payment.

Correct Answer

verified

Show Answer

A) Banks
B) Railroads
C) Health maintenance organizations
D) Partnerships
E) Insurance companies

Correct Answer

verified

Show Answer

A) The payment was not preferential because it was made over 90 days before the filing of the bankruptcy petition.
B) The payment was not preferential because it was made over 120 days before the filing of the bankruptcy petition.
C) The payment was not preferential because it was made over 180 days before the filing of the bankruptcy petition.
D) The payment was preferential because it was made to a business partner and made within two years of the filing of the bankruptcy petition unless Mindy can establish that she was not insolvent when the payment was made.
E) The payment was preferential on the basis that it was made to a business partner within two years of the filing of the bankruptcy petition only if the trustee is able to demonstrate that Mindy was insolvent when she made the payment.

Correct Answer

verified

Show Answer

A) The Bankruptcy Trust, Reconciliation, and Remedial Amendments of 2000
B) The Bankruptcy Fraud Protection Act of 2007
C) The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005
D) The Bankruptcy Fraud and Consumer Shield Act of 2006
E) The Insolvency Protection Amendments of 2006

Correct Answer

verified

Show Answer

Correct Answer

verified

Show Answer

A) Any efforts to collect on the past due alimony are stayed by the bankruptcy proceeding, and the claim for alimony is subject to discharge.
B) Any effort to collect on the past due alimony are stayed by the bankruptcy proceeding, but alimony payments are nondischargeable.
C) Efforts to collect on past due alimony payments accrued prior to the filing of the bankruptcy petition are stayed, but efforts to collect on alimony payments accruing after the filing of the bankruptcy petition are not stayed; and alimony payments are nondischargeable.
D) Efforts to collect on past due alimony payments accrued only after the filing of the bankruptcy petition are stayed, but efforts to collect on alimony payments accrued before the filing of the bankruptcy petition are not stayed; and alimony payments are nondischargeable.
E) Legal action to collect alimony is not subject to the stay, and alimony payments are nondischargeable.

Correct Answer

verified

Show Answer

Correct Answer

verified

The first four classes of priority claim...

View Answer

Show Answer

A) An unfair payment
B) An unequal payment
C) A preferential payment
D) An unendorsed payment
E) An unapproved payment

Correct Answer

verified

Show Answer

A) Voluntary
B) Involuntary
C) Complaint
D) Accusatory
E) Dispute

Correct Answer

verified

Show Answer

A) Involuntary petitions are not allowed under Chapter 7.
B) At least 5 creditors must file in order for an involuntary petition to be accepted; therefore, the involuntary petition will be dismissed in Mona's case.
C) Only 3 creditors may file an involuntary petition, but their aggregate claims must be $20,100; therefore, the petition will be dismissed in Mona's case.
D) The petition was properly filed because 3 or more creditors with unsecured claims totaling $14,425 or more signed the petition for involuntary bankruptcy.
E) The petition was properly filed because only 2 or more creditors with secured or unsecured claims totaling at least $10,500 must sign a petition for involuntary bankruptcy.

Correct Answer

verified

Show Answer

A) Both exemptions will likely be granted because their type and value are within allowable federal exemptions.
B) The exemption claimed for the jewelry will likely be granted; but in order to ascertain the status of the vehicle, further information is needed in regard to whether it is used in business.
C) The exemption claimed for the vehicle will likely be granted, but the exemption claimed for the jewelry will likely be disallowed because no exemption may be claimed for jewelry.
D) The exemption claimed for the vehicle will likely be granted, but the exemption claimed for the jewelry will likely be disallowed because a federal exemption may only be claimed for jewelry consisting of a wedding band worth less than $400.
E) The exemption claimed or the jewelry will likely be allowed, but the exemption claimed for the vehicle will likely be denied because the federal exemption for a vehicle is limited to $1,000.

Correct Answer

verified

Show Answer