Q: 8
A business files for bankruptcy with the goal of obtaining relief from creditors so that it can rearrange its financial affairs and continue as a going concern. Which of the following describes this type of bankruptcy proceeding?
Options
Discussion
A imo, D looks tempting but that's for shutting down, not keeping the business alive. Reorganization fits "continue as a going concern."
A, Had something like this in a mock exam last month, sticking with A here.
A, That matches how reorganization bankruptcy works when the business plans to keep operating.
A tbh, seen this explained in the official guide and a few practice sets.
Not C or D here. The fact that it wants to keep operating is key, which makes A (Reorganization bankruptcy) fit best. Debt dismissal and liquidation both miss the "continue as a going concern" part-trap options if you skip that detail. I've seen similar Qs worded this way in practice sets.
C/D? I thought debt dismissal bankruptcy (C) might be the answer since it sounds like wiping the debts completely, which is what some businesses aim for. Not 100% on this, but it feels possible given the phrasing here. Anyone see C in practice tests?
A
Saw almost the same question in my practice dump, pretty sure it's A.
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