In relation to the order of priority of payment of debts upon liquidation,which statement is correct?

Question

Quizplus · Accepted Answer

Preferential unsecured creditors, such as employees and tax authorities, rank higher in priority than ordinary unsecured creditors. Deferred creditors, such as shareholders, rank the lowest in priority among all creditors. Secured creditors have priority over both unsecured and deferred creditors. Therefore, statement B is correct.

In Relation to the Order of Priority of Payment of Debts