Owners' claims to total business assets take precedence over the claims of creditors because owners invest assets in the business and are liable for losses.

Name: Owners' claims to total business assets take precedence over the claims of creditors because owners invest assets in the business and are liable for losses.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Creditors' claims on a business's assets take precedence over the owners' claims because creditors must be paid before equity owners in the event of liquidation or bankruptcy.

Owners' Claims to Total Business Assets Take Precedence Over the Claims