Multiple Choice Questions

1. In cases in which a consumer has the means to repay all debts but files bankruptcy under Chapter 13, the trustee will likely file a motion with the court to do what?

a. Fine the debtor for filing a fraudulent petition.

b. Dissolve only abusive debts.

c. Dismiss the petition.

d. Reaffirm the debts.

2. At the first meeting of the creditors, who normally answers questions from the creditors or trustee?

a. The debtor or debtor’s representative.

b. Both the debtor and the debtor’s legal counsel.

c. Neither the debtor nor the debtor’s representative.

d. None of these.

3. Which of the following applies to divorce rather than bankruptcy?

a. The general legal procedures and the procedures to uncover concealed assets are similar.

b. The general legal procedures are dissimilar but the procedures to uncover concealed assets are similar.

c. The general legal procedures are similar, but the procedures to uncover concealed assets are dissimilar.

d. Both the general legal procedures and procedures to uncover concealed assets are dissimilar.

4. In a divorce proceeding, loss carryforwards on the federal tax returns should be treated as which of these?

a. A debtor’s asset.

There is no “debtor” in divorce proceedings, but rather in bankruptcy proceedings.

b. A creditor’s asset.

c. A debtor’s liability.

d. None of these.

5. The forensic accountant should perform a cash flow analysis of a debtor in a bankruptcy proceeding. If the analysis reveals that the debtor cannot account for substantial amounts of cash, which of the following is likely to happen?

a. A court order could be obtained forcing the debtor to repay the unaccounted for cash according to a court-ordered payment plan.

b. The court rejects the debtor’s bankruptcy petition.

c. Criminal charges are brought against the debtor.

d. All of these.

e. Answers a and b only.