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Q:
Zeke files a petition for bankruptcy under Chapter 13. Zeke's Chapter 13 plan must provide for
a. the turnover of his future income to the trustee.
b. his attendance at a credit-counseling briefing.
c. adequate means for the petition's execution.
d a preference for one creditor over another.
Q:
To adjust debt and institute a repayment plan, Biancawho is not a corporation, a partnership, or a family farmer or fishermanmay file a petition in bankruptcy for relief through
a. a liquidation.
b. a reorganization.
c. a repayment plan.
d. a family-farmer bankruptcy plan.
Q:
A petition for a discharge in bankruptcy under Chapter 13 may be filed by
a. Gracie, the sole proprietor of Home Net Services.
b. Internet Portals & Pages, a partnership.
c. World Web Services, Inc., a corporation.
d. Internet Portals & Pages or World Web Services, Inc..
Q:
Anthony believes that he needs to obtain a Chapter 13 discharge in bankruptcy. A Chapter 13 case can be initiated by a filing of a voluntary petition by
a. a creditor only.
b. a corporation only.
c. a debtor only.
d. a trustee only.
Q:
Ed is a debtor. Financial Loans, Inc., and the government are Ed's creditors. For these parties, a bankruptcy proceeding under Chapter 13 could be initiated by the filing of a petition by
a. Ed alone or by his creditors jointly.
b. Ed only.
c. Financial Loans only.
d. the government only.
Q:
To adjust debt and institute a repayment plan, Delton, a family fisherman in the Gulf of Mexico, may file a petition in bankruptcy for relief under the Bankruptcy Code's Chapter
a. 1.
b. 3.
c. 5.
d. 12.
Q:
Checkerboard Pizza, Inc. (CPI), files for bankruptcy under Chapter 11. CPI's Chapter 11 plan must contain
a. a plan to turn over its future income to the trustee.
b. a certificate proving attendance at a credit-counseling briefing.
c. a provision of adequate means for the plan's execution.
d a statement of preference for one creditor over another.
Q:
Shale Oil, Inc., files a petition in bankruptcy for relief through a reorganization and assumes the role of a debtor in possession. In this role, Shale Oil is similar to
a. a creditor at a creditors' meeting.
b. an individual debtor who is denied a discharge under the means test.
c. a secured creditor in possession of collateral.
d. a trustee in a liquidation.
Q:
A petition for a discharge in bankruptcy under Chapter 11 may be filed by
a. Reliable Insurance Company.
b. Pacific Mountain Railroad.
c. Solid State Bank.
d. Valley Credit Union.
Q:
Paxton agrees to pay QuikChek Lenders a debt that is otherwise dischargeable in bankruptcy. This is
a. a reaffirmation.
b. a rescission.
c. a reorganization.
d. a revocation.
Q:
Wild River Tours Corporation wants to formulate a plan under which it pays a portion of its debts and is discharged of the remainder while continuing in business. To accomplish this goal, Wild River should file a petition in bankruptcy for relief through
a. a liquidation.
b. a reorganization.
c. a repayment plan.
d. a family-farmer bankruptcy plan.
Q:
Sheryl files a petition in bankruptcy. Sheryl's non-dischargeable debts include
a. domestic-support obligations.
b. student loans if payment would impose undue hardship.
c. unpaid loans to finance home repairs.
d. unsecured credit-card debt.
Q:
Lionel files a voluntary petition for bankruptcy under Chapter 7. The court will likely deny a discharge of Lionel's debts if he
a. conceals records of his financial condition with the intent to defraud a creditor.
b. does not have sufficient assets to pay all his secured creditors.
c. filed for bankruptcy twelve years ago.
d. has a criminal record.
Q:
Umiko files a petition for bankruptcy. Her creditors must file with the court their proof of claims against her assets within
a. fifteen days of the order for relief.
b. thirty days of the filing of the petition.
c. sixty days of the automatic stay.
d. ninety days of the creditors' meeting.
Q:
Damian owns a pick-up truck and a motorcycle. He sells the motorcycle to Eden for $10,000. Eden pays for the cycle with a check, knowing that she had insufficient funds in her account to cover the amount. A week later, Damian files a petition in bankruptcy for relief through a liquidation.Regarding the pick-up truck, Damiana. can exempt an interest in it up to $3,675 from the bankruptcy.b. must include it as part of the estate because Damian sold the cycle.c. must include it as part of the estate because Eden's check did not cover the cost of the cycle.d. must include it as part of the estate unless the trustee recovers the price from Eden.
Q:
Damian owns a pick-up truck and a motorcycle. He sells the motorcycle to Eden for $10,000. Eden pays for the cycle with a check, knowing that she had insufficient funds in her account to cover the amount. A week later, Damian files a petition in bankruptcy for relief through a liquidation.
Regarding the sale of the cycle, the bankruptcy trustee can
a. cancel it as a fraudulent transfer.
b. cancel it as a voidable preference.
c. not cancel it or sue to recover the price because it occurred before Damian filed his petition in bankruptcy.
d. not cancel it, but can sue Eden to recover the price.
Q:
Thirty-one days before filing a petition in bankruptcy, Gavin transfers property and makes payments that favor one creditor over another. These are
a. affirmation agreements.
b. preferences.
c. secured interests.
d. unsecured debts.
Q:
Norma files a petition in bankruptcy. She turns her assets over to O"Brien, who sells them and then distributes the proceeds to Norma's creditors. O"Brien is a
a. preferred creditor.
b. bankruptcy court judge.
c. bankruptcy trustee.
d. debtor.
Q:
Thirty-one days before filing a petition in bankruptcy, Dee transfers property and makes payments that favor one creditor over another. These are
a. affirmation agreements.
b. preferences.
c. secured interests.
d. unsecured debts.
Q:
Gerald files a bankruptcy petition. The resulting automatic stay will apply to Gerald's
a. alimony debts.
b. child-support debts.
c. spousal maintenance debts.
d. car payment debts.
Q:
Patsy files a petition in bankruptcy. At the moment of filing
a. an automatic stay goes into effect.
b. Patsy's debts are discharged.
c. Patsy's petition is dismissed.
d. Patsy's property is distributed to her creditors.
Q:
Jayme's voluntary petition for bankruptcy is found to be proper. The order for relief is effective as soon as
a. Jayme files the petition.
b. Jayme posts a bond to cover the costs of the proceedings.
c. Jayme's creditors agree to the terms.
d. the trustee collects and distributes the property of Jayme's estate.
Q:
Donna goes through an involuntary bankruptcy proceeding. An involuntary bankruptcy occurs when
a. a debtor files forms designated for the purpose in a bankruptcy court.
b. a debtor is unable to pay his or her debts as they come due.
c. a debtor's creditors force the debtor into bankruptcy proceedings.
d. a debtor's debts exceed the fair market value of his or her assets.
Q:
Bobby has fifteen creditors. To force Bobby into bankruptcy proceedings, at least three creditors must join the petition and their unsecured claims must add up to at least
a. $500.
b. $10,250.
c. $14,425.
d. $50,000.
Q:
Charlton files a petition in bankruptcy in a liquidation proceeding. If the court administers the means test and concludes that Charlton is abusing the bankruptcy process by filing for a liquidation, most likely
a. Charlton will be forced to file for relief through an individual repayment plan.
b. the court will discharge Charlton's debts.
c. the court will distribute Charlton's property to Charlton's creditors.
d. the court will issue an automatic stay against any actions by Charlton's creditors.
Q:
Sheri files a petition for bankruptcy. She must include with the petition
a. a plan to turn over her future income to a trustee.
b. a certificate proving credit-counseling from an approved agency.
c. a provision of adequate means to make periodic cash payments to creditors.
d a statement of preference for one creditor over another.
Q:
Joe files a voluntary petition for Chapter 7 bankruptcy. His petition does not need to include
a. a list of Joe's secured creditors.
b. a list of Joe's unsecured creditors.
c. a list of the occupations of all Joe's creditors.
d. the addresses of all Joe's creditors.
Q:
Roland files for Chapter 7 bankruptcy. After all his assets have been sold and the proceeds distributed among his creditors, Roland's remaining debts
a. are discharged.
b. paid by the court.
c. must be paid by Roland.
d. are put on hold until Roland has sufficient means to pay them.
Q:
Wilson wants to file an ordinary, or straight, bankruptcy. Wilson should file using
a. Chapter 7.
b. Chapter 11.
c. Chapter 13.
d. his state's bankruptcy code.
Q:
Norma Jean files for Chapter 7 bankruptcy. She turns her assets over to Addie, who sells the assets and then distributes the proceeds to Norma Jean's creditors. Addie is a
a. creditor.
b. federal judge.
c. bankruptcy trustee.
d. debtor.
Q:
A petition for a discharge in bankruptcy in a liquidation proceeding may be filed by
a. Eminent Employees Credit Union, a corporation.
b. Federal Savings & Loan Association, a corporation.
c. Guaranty Insurance Company, a corporation.
d. Hazel, an independent accountant.
Q:
Deborah files a petition in bankruptcy. One of the goals of bankruptcy law with respect to a debtor who has "gotten in over his head" is to
a. encourage the continued use of credit to borrow funds.
b. ensure that co-debtors will continue to guarantee loans.
c. provide s debtor by giving him or her a fresh start without creditors' claims.
d. shield assets from creditors.
Q:
Bess wishes to appeal a decision from a federal bankruptcy court. Bess must appeal to
a. a county court.
b. a federal district court.
c. the U.S. Supreme Court.
d. a state court.
Q:
A student loan is discharged under Chapter 13 unless the creditor can show "undue hardship."
Q:
In a repayment plan case, the plan must provide for payment of all obligations in full, not for a lesser amount.
Q:
The procedure for filing a family-farmer bankruptcy plan is similar to the procedure for filing a repayment plan.
Q:
Certain liquidation cases may be converted to Chapter 13 with the consent of the debtor.
Q:
For individual debtors, the plan in a reorganization case must be completed before discharge will be granted.
Q:
A Chapter 11 reorganization plan must provide for payment of tax claims over a five-year period.
Q:
On the entry of an order for relief in a Chapter 11 case, the creditors generally take over the operation of the debtor's business.
Q:
The same principles that govern the filing of a liquidation petition apply to reorganization proceedings.
Q:
A bankruptcy court may deny a discharge based on a debtor's conduct.
Q:
Certain debtors may not qualify to have all debts discharged in bankruptcy.
Q:
Once a discharge is granted, it may not be revoked, even if, for example, a debtor concealed property to defraud a creditor.
Q:
A discharge will be denied to a debtor who received a discharge within eight years of filing the current petition.
Q:
Some student loans are dischargeable in a Chapter 7 bankruptcy.
Q:
In order of priority, the claims of all unsecured creditors in a class must be satisfied before any remaining amounts can be distributed to the next class.
Q:
A trustee must call a meeting of the creditors listed in the schedules filed by the debtor.
Q:
In most states, state law determines the amount of a debtor's property that is exempt from distribution on bankruptcy.
Q:
The basic duty of a trustee is to collect the debtor's available estate and reduce it to cash for distribution.
Q:
A trustee has the power to avoid a sale of the debtor's property.
Q:
Child-support debts will be suspended by a voluntary bankruptcy filing.
Q:
A bankruptcy estate consists of all the debtor's interests in property currently held, wherever located.
Q:
An involuntary bankruptcy occurs when a debtor's creditors are forced to accept a discharge of the debtor's debts.
Q:
The filing of a petition for bankruptcy will automatically stay most legal actions against the debtor.
Q:
An order for relief in a bankruptcy proceeding amounts to a discharge of the debts of the party petitioning for bankruptcy protection.
Q:
The means test forces more people to file for Chapter 7 bankruptcy rather than gave their debts discharged under Chapter 13.
Q:
If a debtor's income is below the median income, there is no presumption of bankruptcy abuse.
Q:
Concealing assets from a bankruptcy court is a crime.
Q:
Before filing for bankruptcy, a consumer-debtor must receive credit counseling.
Q:
Any "person"defined as including corporationsmay be a debtor in a liquidation proceeding.
Q:
A husband and wife may file a joint petition for bankruptcy.
Q:
The clerk of a bankruptcy court must provide consumer-debtors with information on the types of services available from credit counseling agencies.
Q:
Rulings from bankruptcy courts are finalthey cannot be appealed.
Q:
Bankruptcy proceedings are held in federal courts.
Q:
Bankruptcy law is state law.
Q:
One goal of bankruptcy law is to protect a debtor.
Q:
The right to petition for bankruptcy relief under federal law may be a necessary evil in our capitalistic society.
Q:
Drew and Earl are brothers. They agree to act as guarantors on a loan made by their sister, Flo. Flo defaults on the payments and Drew refuses to pay. Earl pays the debt. Earl can recover from
a. Drew and Flo under the right of proportionate liability.
b. Drew and Flo under the right of reimbursement.
c. Drew under the right of contribution and Flo under the right of subrogation.
d. no one, because the parties are brothers and sister.
Q:
Consumer Credit, Inc. (CCI), lends $1,000 to Joe. Kay acts as Joe's surety. If Kay pays the loan, she gets
a. any right that CCI had against Joe, but not a right to be reimbursed by Joe.
b. a right to be reimbursed by Joe, but not any right that CCI had against Joe.
c. any right that CCI had against Joe and a right to be reimbursed by Joe.
d. none of the choices.
Q:
Maggie is a surety for Juli's debt to Bill. Bill and Juli decide to make material changes to the original contract without consulting Maggie. Maggie is
a. still bound by the contract.
b. discharged completely.
c. still bound by the contract, but allowed to make additional changes to the contract.
d. still bound by the contract unless she contests it within 30 days of the changes.
Q:
William is a surety for Jeannie's loan from Richard. Richard knows of William's existence. When the loan comes due, Jeannie tries to pay Richard, but Richard rejects the payment. William is
a. released from any obligation on the debt.
b. required to pay the amount of the debt to Richard.
c. required to pay up to half of the amount of the debt to Richard.
d. required to pay the amount of the debt to Jeannie.
Q:
Dina asks Edie to co-sign a credit application so that she can borrow money and buy a truck from First Street Motors. If, after the loan agreement is signed, Dina agrees to a higher rate of interest without telling Edie, then Edie is
a. discharged from the agreement.
b. liable at the higher rate of interest.
c. liable at the lower rate of interest.
d. liable for the principal only.
Q:
Muffins-2-Go buys a truck from Street Vehicles, Inc., under a contract signed by Riley, Muffins-2-Go's president, making him personally liable if Muffins-2-Go does not pay the loan. Riley is
a. a guarantor.
b. a surety.
c. a co-surety.
d. a co-creditor.
Q:
Petro Oil Refinery asks Quality Bank for a loan to increase its oil inventory. Quality requires Robin, Petro's president, sign a personal guaranty to pay the debt if Petro defaults. Meanwhile, to sell fifty barrels of refined oil to Slick Lubricants, Inc., Petro asks its outside accountant Tina to co-sign a credit application.
If, after the loan agreement is signed, Slick agrees to a higher rate of interest without telling Tina, then Tina is
a. discharged from the agreement.
b. liable at the higher rate of interest.
c. liable at the lower rate of interest.
d. liable for the principal only.
Q:
Petro Oil Refinery asks Quality Bank for a loan to increase its oil inventory. Quality requires Robin, Petro's president, sign a personal guaranty to pay the debt if Petro defaults. Meanwhile, to sell fifty barrels of refined oil to Slick Lubricants, Inc., Petro asks its outside accountant Tina to co-sign a credit application.
If Robin is a guarantor, then the guaranty is required to be in writing because of
a. the debtor's right of redemption.
b. the co-signer's right of contribution.
c. the creditor's transfer of possession.
d. the Statute of Frauds.
Q:
Petro Oil Refinery asks Quality Bank for a loan to increase its oil inventory. Quality requires Robin, Petro's president, sign a personal guaranty to pay the debt if Petro defaults. Meanwhile, to sell fifty barrels of refined oil to Slick Lubricants, Inc., Petro asks its outside accountant Tina to co-sign a credit application.
If Tina signs the application only after language is included that requires Petro to exhaust its legal remedies against Slick before looking to her, then Tina is
a. a surety.
b. a lienor.
c. a guarantor.
d. a creditor.
Q:
Petro Oil Refinery asks Quality Bank for a loan to increase its oil inventory. Quality requires Robin, Petro's president, sign a personal guaranty to pay the debt if Petro defaults. Meanwhile, to sell fifty barrels of refined oil to Slick Lubricants, Inc., Petro asks its outside accountant Tina to co-sign a credit application.
If Tina signs the application but fails to condition her signature on Petro's agreement to pursue its legal remedies against Slick before looking to her, then Tina is
a. a surety.
b. a lienor.
c. a guarantor.
d. a creditor.
Q:
Lenders Loan Company and Mortgage Service CorporationNadya's creditorscontract with Nadya for the discharge of her liquidated debts on payment of a lesser sum. This is
a. a composition agreement.
b. a subrogation.
c. a suretyship agreement.
d. in violation of most states' laws.
Q:
Nell's debt to Olsen is past due. Olsen obtains an order of garnishment to require Nell's employer Pro Transmission Service, Inc., to pay part of Nell's paycheck to Olsen. The law
a. limits the amount that can be taken from Nell's take-home pay.
b. permits Olsen to dismiss Nell because her wages are garnished.
c. practically does not allow Olsen to collect the awarded amount.
d. requires Pro to retain Nell as an employee until the debt is paid.