Which one of the following is a direct bankruptcy cost?
A)Loss of customer goodwill resulting from a bankruptcy filing
B)Legal and accounting fees related to a bankruptcy proceeding
C)Management time spent on a bankruptcy proceeding
D)Any financial distress cost
E)Costs a firm spends trying to avoid bankruptcy

Question

Quizplus · Accepted Answer

Legal and accounting fees are direct costs incurred specifically due to the bankruptcy process.

Which One of the Following Is a Direct Bankruptcy Cost