Question

__________ is a state in which a company’s liabilities are more than its assets so that is unable to repay its debts

A Bankruptcy Correct Answer Incorrect Answer
B Insolvency Correct Answer Incorrect Answer
C Liquidation Correct Answer Incorrect Answer
D Either of the above Correct Answer Incorrect Answer
E Both (a) & (b) Correct Answer Incorrect Answer

Solution

Insolvency is a state in which a company’s liabilities are more than its assets so that is unable to repay its debts. Bankruptcy is when a person is legally declared by a competent court as incapable of paying its debts/dues.

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