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IgorLugansk [536]
3 years ago
12

____ bankruptcy temporarily relieves a company from its debts while it reorganizes and works out a payment plan with its credito

rs.
Social Studies
1 answer:
posledela3 years ago
4 0

Answer:

According to the <u>Chapter 11 of the Bankruptcy Code</u> (the federal level law), bankruptcy temporarily relieves a company from its debts while it reorganizes and works out a payment plan with its creditors.

Explanation:

If the company <em>chooses to continue its operation</em> and find a way out of the crisis, it would opt for Chapter 11. While all the major decisions would have to be approved by the bankruptcy court,  the company would be still allowed to continue its daily business activities and thus have a chance to become profitable. If the company opts for Chapter 7 of the Bankruptcy Code, it would have to cease its business operation completely.

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