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Which of the Following Is Not True of a Company

Question 40

Multiple Choice

Which of the following is not true of a company operating as a "debtor-in-possession' after a chapter 11 reorganization plan is approved by the bankruptcy court?


A) ​Provisions are binding on all creditors and security holders, whether or not they accepted the plan.
B) ​Property is vested in the debtor company is free of all claims, except as stipulated under the plan.
C) ​If the reorganization is not accomplishing its objective, a request for modification or conversion to a chapter 7 liquidation may be submitted to the court.
D) ​If the plan contained the provision to pay accounts payable at $.50 on $1.00, and the company's cash flow is better than expected, the amount paid could be increased.

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