The document comprises a series of questions and answers relating to bankruptcy law under various sections of the U.S. Bankruptcy Code. It covers roles of trustees, creditor rights, dischargeability of debts, and procedures for different bankruptcy chapters, including implications of debtor actions and preferences. The content is structured to aid understanding of complex bankruptcy concepts through multiple choice, true or false, and short answer formats.

1. Figure 1 “ True or False”
Question 1
1. Under Section 704 of the Code, the Trustee's basic duties are
to litigate, liquidate, administrate and investigate.
Question 2
1. The Official Creditor's Committee in Chapter 11 normally
consists of among the twenty largest unsecured creditors.
Question 3
1. A debtor-in-possession is the equivalent of a trustee for most
purposes.
Question 4
1. A corporate debtor in Chapter 7 does not receive a discharge.
Question 5
1. A creditor can request that the Bankruptcy Court order the
trustee to examine the acts and conduct of the debtor to
determine if grounds exist to deny the debtor a discharge.
Question 6
1. A debt arising from a marital property settlement agreement
is always dischargeable.
Question 7
1. To be considered non-dischargeable, the burden is on the
creditor to file an adversary complaint when the debt was
obtained through a fraudulent representation, through fraud
while the debtor was serving in a fiduciary capacity, through
embezzlement or larceny, or as the result of willful and
malicious injury.
Question 8
1. If the debtor purchases $750 worth of holiday gifts in
November on her visa card and then files for bankruptcy on
January 1 of the following year, that debt is presumed
nondischargeable.

2. Question 9
1. A Chapter 7 individual debtor may not receive a discharge
until they complete a post petition financial management
course.
Question 10
1. Under Section 546 of the Code, certain creditors may be
allowed to perfect liens in property of the estate after a petition
is filed.
Question 11
1.
3. A statutory lien may never be avoided in bankruptcy.
Question 12
1. A provision in an agreement forfeiting the debtor's interest in
property upon becoming insolvent is generally enforceable.
Question 13
1. For a preferential transfer to occur, among other things, there
must be a transfer of property of the debtor for or on account of
an antecedent debt.
Question 14
1. Transfers made to satisfy domestic support obligations during
the 90 day period immediately preceding the bankruptcy filing
are avoidable as preferences.
Question 15
1. For purposes of preferential transfers, the debtor is presumed
solvent for the 90 day period immediately preceding the
bankruptcy filing.
Question 16
1. A Chapter 7 bankruptcy trustee may sell or use property of
the estate, which is not cash collateral, in the ordinary course of
business without court approval.
Question 17

3. 1. In all cases (7, 11 and 13) a debtor or trustee must make the
decision to assume or reject any executory contract within 60
days after the case is commenced.
Question 18
1. An executory contract is one where some performance
remains to be rendered on all sides.
Question 19
1. In a Chapter 11 case, no specific amount of time is specified
within which a debtor-in-possession/trustee must assume or
reject an unexpired lease of residential real property or
executory contract.
Question 20
1.
3. An individual consumer bankruptcy debtor may not assume a
lease of personal property if the trustee does not do so.
Question 21
1. An unsecured claim is one that arises after the filing of a
bankruptcy petition.
Question 22
1. There are normally no priorities among administrative
claimants.
Question 23
1. Unsecured claims of individuals up to $2,775.00, arising
from the deposit of money before the commencement of the case
for personal, family or household use are treated as general
unsecured
claims for all purposes.
Question 24
1. A gap period claim is a claim incurred during that period of
time
between the filing of an involuntary petition and prior to the
entry
of an order for relief.
Question 25

4. 1. The maximum length of time for a Chapter 13 plan, with
Court approval, is 6 years.
Question 26
1. A Chapter 13 plan may provide for the payment of principal
and interest payments under a long term loan even after the
lapse of 5 years from the date the plan is approved, when the
due date of the loan falls after completion of the plan.
Question 27
1. A Chapter 13 plan may be used to cure defaults on a
mortgage while the debtor maintains regular monthly mortgage
payments outside of the plan.
Question 28
1. The Chapter 13 debtor does not have to begin making
payments to the trustee until his/her plan is confirmed by the
court.
Question 29
1. All postpetition domestic support obligations must have been
paid and all postpetition tax returns filed before a Chapter 13
plan can be confirmed.
Question 30
1. Chapter 11 is a reorganization vehicle only for large
businesses.
Question 31
1. If the debtor-in-possession files a plan of reorganization
within 120 days of the filing of a chapter 11 petition, the
debtor-in-possession will have an additional 60 days to obtain
creditor acceptance before any other party may propose a plan
of reorganization.
Question 32
1. An unimpaired class of claims in a Chapter 11 plan is
presumed to have accepted the plan of reorganization.
Question 33
1. A disclosure statement accompanying a Chapter 11 plan of
reorganization should include, among other things, at least a
summary of the plan's important terms.

5. Question 34
1. If an impaired class of claims does not vote to accept a
proposed Chapter 11 plan, it cannot be confirmed.
Question 35
1.
1. Any individual may file a case under Chapter 12 of the
Bankruptcy Code.
Question 36
1.
1. Chapter 12 differs from Chapter 13 in that it does not have a
codebtor stay and the debtor’s postpetition earnings are not
property of the estate.
Fiqure 2 “Multiple Choices”
Question 37
1. In a Chapter 11 case the debtor-in-possession:
a.
is authorized to continue to operate the debtor's business
without court approval.
b.
must cease all operations at the time the petition is filed.
c.
must surrender all property to the trustee when the petition is
filed.
d.
need not close existing business bank accounts and open new
ones.
Question 38
1. In a Chapter 7 case:
a.

6. The interim trustee can be removed in favor of another trustee
by vote of the creditors at the meeting of creditors.
b.
The interim trustee will become the trustee if the Bankruptcy
Court has appointed him or her as trustee.
c.
The debtor-in-possession is trustee.
d.
The U.S. Trustee will be the trustee in all cases.
Question 39
1. Among the Trustee's duties are:
a.
Accounting for all property received.
b.
Disbursing money.
c.
Filing a final report and accounting.
d.
All of the above.
Question 40
1. All of the items in choices “a”-”c” are specifically contained
in Code Section 704, which specifies the trustee's duties.
Choice “d” is therefore the correct answer.
a.
For a limited period of time with court approval.

7. b.
When the case is converted to a Chapter 13.
c.
Will never operate a debtor's business.
d.
Until the case is closed.
Question 41
1. A “contested matter” is:
a.
an opposed motion that is treated like an adversary proceeding.
b.
an unopposed noticed motion.
c.
an adversary proceeding initiated by filing a Summons and
Complaint.
d.
None of the above.
Question 42
1. The automatic stay goes into effect when:
The debtor appears at the meeting of creditors.
Following a notice and a hearing.
When the petition is filed.

8. When a motion for relief from stay is filed.
Question 43
1. The following is not subject to the automatic stay.
Criminal action.
Action to collect a judgment.
Mailing past due notices to the debtor.
A non-judicial foreclosure sale.
Question 44
1. The automatic stay remains in effect as to property of the
estate until:
The case is closed.
The case is dismissed.
In the Chapter 7 of an individual, until the debtor receives a
discharge, except in certain serial filing situations.
All of the above.

9. Question 45
1. A debtor opposing a relief from stay motion may be able to
provide adequate protection of a secured creditor's interest by
showing:
a.
That the value of the creditor's collateral is substantially more
than the creditor is owed.
b.
That the value of the creditor's collateral is worth substantially
less than what the creditor is owed.
c.
That the bankruptcy petition is filed.
d.
All of the above.
Question 46
1. A form of “adequate protection” of a secured creditor's
interest in collateral can be:
a.
Cash payments.
b.
Additional collateral.
c.
Replacement collateral.
d.
All of the above.

10. Question 47
1. Which of the following is not true?
a.
A Chapter 7 debtor’s postpetition wages are not property of the
estate.
b.
The automatic stay applies to the enforcement of alimony or
support obligations.
c.
Exemptions do not apply to the collection of alimony or support
obligations.
d.
A nondebtor spouse may object to the dischargeability of
obligations arising from marital property settlement agreements.
Question 48
1.
1. A Chapter 7 debtor may be denied a discharge for any of the
following reasons except:
a.
Failing to file all tax returns
b.
Failing to attend a Financial Management course
c.
Filing 2 or more bankruptcy cases in the last year
d.

11. Having received a Chapter 7 discharge 6 years ago
Question 49
1. Property of the estate in a Chapter 7 case does not include:
a.
The principal assets of a valid “spendthrift” trust.
b.
Wages earned by a debtor after the filing of a petition.
c.
All of the above.
d.
None of the above.
Question 50
1. Property of the estate includes:
a.
Property held by the debtor for a third person.
b.
Property in which the debtor has any legal or equitable interest.
c.
Wages of a Chapter 7 debtor.
d.
None of the above.
Question 51
1. The policy behind the trustee's “avoiding powers” is:

12. a.
To give the debtor the right to favor one creditor over another.
b.
To keep bankruptcy filings down.
c.
To give the debtor maximum benefit of exemptions.
d.
To provide the most equitable distribution to creditors of a
debtor's assets.
Question 52
1. A preferential transfer may be defensible if:
a.
The creditor has received more than it otherwise would have
received had the transfer not been made.
b.
The transfer of the debtor's property to the creditor is made in
the ordinary course of business of the debtor and the creditor,
according to ordinary business terms.
c.
The creditor offsets its debt.
d.
The creditor transfers to a third party the property of the debtor
given to the creditor.
Question 53
1. A fraudulent conveyance that a trustee may set aside includes

13. a transfer of property of the debtor:
a.
For or on account of an antecedent debt.
b.
A contemporaneous exchange of property of the debtor for new
value given by the creditor.
c.
That renders the debtor insolvent and is a transfer for less than
reasonably equivalent value.
d.
None of the above.
Question 54
1. In order to assume an unexpired lease, the trustee or debtor-
in-possession must:
a.
Cure all defaults.
b.
Assign the lease.
c.
All of the above.
d.
None of the above.
Question 55
1. The purpose of abandonment (Section 554) is to:

14. a.
Eliminate burdensome property of inconsequential value to the
estate.
b.
Give the debtor its exempt property.
c.
Provide adequate protection to a secured creditor.
d.
Allow the debtor a discharge.
Question 56
1. A proof of claim:
a.
Creates a presumption that a claim is valid.
b.
Is filed with the trustee.
c.
Is always needed for secured claims.
d.
Is always requested of creditors in a chapter 7 case.
Question 57
1. When a debtor intends to retain a secured motor vehicle in a
Chapter 13 case, the vehicle’s value is most commonly
determined by:
a.
The liquidation value of the vehicle;

15. b.
The replacement value of the vehicle;
c.
The low blue book value of the vehicle;
d.
The Court after a valuation hearing.
Question 58
1. In a Chapter 13, property of the estate includes:
a.
Pre-petition exempt property.
b.
Post-Petition earnings of the debtor.
c.
None of the above.
d.
All of the above.
Question 59
1. In a Chapter 11 plan:
a.
All secured claims are put into one class.
b.
Secured creditors may not be impaired.
c.

16. All claims that are substantially similar should be placed in the
same class.
d.
All unsecured claims must be placed in one class.
Question 60
1. A mandatory requirement for confirmation of a Chapter 11
plan is:
a.
That the plan is feasible.
b.
That the debtor retain property.
c.
There be no new management for the debtor-in-possession.
d.
a. There be only new management for the debtor-in-possession.
Question 61
1. Which of the following are not core proceedings?
a.
a. A complaint objecting to dischargeability of a debt.
b.
b. A motion for relief from the automatic stay.
c.

17. c. A non-exempt personal injury claim.
d.
d. An objection to a debtor’s claim of exemptions.
Figure 3 “ Short Answers”
Question 62
1. What is the standard for a consumer debtor to obtain
discharge of a student loan on the grounds of “undue hardship”?
Question 63
1. Describe the resources to use in researching a bankruptcy
issue.
Question 64
1. One of your goals in preparing a bankruptcy petition,
schedules etc is to make matters as easy for the Trustee as
possible. What should you prepare in an asset case prefiling and
postfiling?