If the firm becomes insolvent, in order to settle debts creditors can claim

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If a firm becomes insolvent and cannot pay its debts, creditors have various methods to recover their money. In the case of a corporation, creditors can make claims on the assets of the corporate entity, such as cash, inventory, equipment, and property. In the case of a partnership, creditors can seize the business and personal assets of the partners, including bank accounts, investments, homes, cars, and other possessions. In the case of a sole proprietorship, creditors can go after the owner's personal and business assets, since the business and individual are considered the same legal entity. So, it is possible for creditors to claim all of the above assets to settle debts.

If the Firm Becomes Insolvent, in Order to Settle Debts