Describe the bankruptcy process.

Entrepreneurial Finance
6th Edition
ISBN:9781337635653
Author:Leach
Publisher:Leach
Chapter16: Financially Troubled Ventures: Turnaround Opportunities?
Section: Chapter Questions
Problem 18DQ
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Describe the bankruptcy process.

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Bankruptcy is a legal process that provides individuals and businesses with a way to manage overwhelming debt and seek protection from their creditors. Bankruptcy allows debtors to either discharge or restructure their debts under the supervision of a bankruptcy court.

Bankruptcy can be filed by an individual, a business, or any other entity that owes money to creditors and is unable to pay its debts. The process involves the debtor providing information about their assets, liabilities, income, and expenses to the bankruptcy court. The court then determines the appropriate course of action based on the type of bankruptcy filed.

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