Which of the following observations concerning claims by general unsecured creditors is NOT true?
A)They are paid only after secured creditors and unsecured creditors with priority are satisfied to the extent of any legal limits.
B)They often receive less than the full amount of their claim.
C)They are entitled to "preference payments" at the discretion of the debtor's management.
D)The amounts to be paid to them are usually stated as a percentage of the total claim.

Question

Quizplus · Accepted Answer

General unsecured creditors are not entitled to preference payments at the discretion of the debtor's management. Preference payments are payments made to creditors that give them preferential treatment over other creditors, and they are generally prohibited in bankruptcy proceedings to ensure equal treatment of creditors.

Which of the Following Observations Concerning Claims by General Unsecured