If a corporation goes bankrupt,
A) neither stockholders nor bondholders receive any money.
B) stockholders get paid from the sale of company assets before bondholders do.
C) bondholders get paid from the sale of company assets before stockholders do.
D) stockholders must honor the debts to bondholders out of personal assets if necessary.

Question

Quizplus · Accepted Answer

Bondholders have a higher priority in receiving payment from the sale of company assets in the event of bankruptcy. Stockholders are usually last in line to receive payment, if there is anything left after paying off the company's debts and obligations.

If a Corporation Goes Bankrupt