33. Forever Yours, Inc. has a secured and perfected security interest in Sally's big-screen TV. On the filing date of Sally's
Chapter 7 petition, the balance of the debt owed to Forever Yours is $2,000. The value of the TV is estimated at $1,500.
This means that Forever Yours:
is secured for the entire debt, $2,000.
is unsecured for $500, the excess of the debt over the value of the TV.
has a high priority claim of $500. This means that Forever Yours, Inc. will be allowed $500 worth of other
unsecured property before other unsecured creditors get anything.
is unsecured for the entire debt.
34. The correct order of payment of claims from the debtor's estate would be:
secured claims, priority claims, unsecured claims.
secured claims, unsecured claims, priority claims.
priority claims, secured claims, unsecured claims.
priority claims, unsecured claims, secured claims.
35. A Chapter 7 debtor's agreement to pay a creditor on a debt after receiving a discharge in bankruptcy is called a:
36. Under what circumstances might the court reject a debtor's Chapter 13 plan?
The plan requires future earnings to pay off debts.
The plan promises to pay all secured and priority claims.
The plan anticipates paying the unsecured creditors less than what they would get under Chapter 7.
The plan treats all unsecured classes equally.
37. Which of the following would not be considered a fraudulent conveyance or a voidable preference under the
provisions of the Code? Immediately prior to filing bankruptcy:
debtor sells assets well below fair market price to Freddie, a friend.
debtor sells his car at a public auction, thinking that it would bring a decent price, but the car brings an amount
well below fair market value.
debtor's corporation transfers assets to stockholders in lieu of cash dividends.
debtor pays $650 to "Nation on Line" for the past ten months of Internet service.
38. Agnes plans to file for bankruptcy under Chapter 7. One month prior to filing, Agnes gives Joe's Filling Station $700
to apply to her gas bill. Joe has been so kind to let her charge the gas she needed for her car over the past year. The
bankruptcy trustee appointed to the case:
can cancel the payment to Joe as a fraudulent transfer.
cannot cancel the payment to Joe because it is payment for an existing debt.