The option of keeping a ﬁnancially distressed ﬁrm as an operating concern is called a(n):
A) Liquidation.
B) Reorganization.
C) Acquisition.
D) Merger.
E) Technical solvency.

Question

Quizplus · Accepted Answer

The option of keeping a financially distressed firm as an operating concern is called reorganization, which involves restructuring the firm's debt and operations in order to improve its financial viability and avoid liquidation. Acquisition, merger, and technical solvency are not specifically related to addressing financial distress. Liquidation involves selling off a company's assets to pay off its debts, which would not allow the firm to continue operating.

The Option of Keeping a ﬁNancially Distressed ﬁRm as an Operating