Question

Given the outcome of this case, how were the bankruptcy attorneys compensated? a. They were not compensated, and therefore, their law firm had to "write off" their out-of-pocket expenses and billable hours. b. They would have simply submitted a bill for their out-of-pocket expenses and been paid that amount by a court. c. They could use an administrative law judge to appeal the case to ask for some limited payment for their time and services.

Answer 1

Answer:

A. they were not compensated, and therefore, their law firm had to "write off" their out-of-pocket expenses and billable hours

Explanation:

In accounting, every loss that a business made through the operation is considered as tax write-off. This regulation is created in order to make businesses who fail to earn profit to survive.

bankruptcy attorneys are most likely wouldn't receive their in cash since they're handling the business that about to closed down.

So, in order to obtain profit from handling such cases, bankruptcy attorneys often took different type of cases (such as business acquisition or Legal consultation) and use the loss they get from bankruptcy cases as a tax write off for their other revenue.