BC Law Ch11 Corporate Insolvency

Which of the following is a company that is considered insolvent?

• The company is unable to pay all debts.

• The company is unable to pay its debts when they are due.

• The company is unable to pay its future debts.

• The company is unable to recover its bad debts.

The role of the _ is to realise the assets under the charge, for the benefit of the creditor he is representing.

The main purpose of receivership is to _.

• rehabilitate the company

• wind-up the company

• pay off the creditors that the receiver is acting on behalf of

• pay off all unsecured creditors

The purpose of _ is to ensure that the company assets are distributed in a just manner between its creditors and members and to bring the company to an end by dissolving it.

Which of the following is not the role of a liquidator?

• Investigate the assets & affairs of the company.

• Recover assets disposed involving undue preference.

• Selling assets of the company to keep it as a going concern.

• Adjudicating the claims of creditors to ensure a fair distribution of the company's assets.

Unsecured creditors of the company are paid on a _ basis.

Select the first creditor that gets paid first when the company is being liquidated.

• Holder of a fixed charge.

• Employee who is owed his salary.

• Supplier who is owed payment for goods supplied.

• Customer who provided an upfront deposit.

Which of the following is a preferential creditor?

• Holder of a floating charge.

• Holder of a debenture.

• Director's fees.

• Liquidator's fees.

Select all that apply to a Members Voluntary Winding-Up.

• The creditors may apply for it.

• Members of the company can pass a resolution for it.

• The company must be unable to pay its debts currently due.

• The company must be able to pay all its debts within 12 months.

Which of the following are grounds for a court to order for compulsory winding-up?

• Company is deemed unable to pay its debts.

• The company is able to carry on as a going concern.

• The company has committed a criminal offence.

• It is just & equitable to wind-up the company.