A reorganization in bankruptcy primarily:
A)restructures the firm's business operations to enhance performance.
B)reorganizes management to get rid of poor performers and put more competent people in charge so the firm will do better in the future.
C)restructures capital to lower interest payments.
D)reorganizes customers.

Question

Quizplus · Accepted Answer

A reorganization in bankruptcy primarily involves restructuring the firm's capital structure in order to reduce interest payments and improve financial viability. While operational and managerial changes may also be implemented, the main focus is on resolving the firm's financial difficulties. Reorganizing customers is not typically a part of the bankruptcy process.

A Reorganization in Bankruptcy Primarily