Ontario Barrister and Solicitor Practice Exam

There are various types of bankruptcy, but the most common for companies are Chapter 7 and Chapter 11 bankruptcies. Chapter 7, also known as liquidation bankruptcy, involves selling off a company's assets to pay off debts. Chapter 11, on the other hand, allows the company to restructure its debts and continue operations. It is considered a form of proposal and often involves a receivership, where a trustee is appointed to supervise the company's financial affairs. B, C, and D are not typical bankruptcy options and do not accurately reflect the options available to a company unable to meet its debt obligations. Liquidation, consolidation, restructuring, refinancing, sell-off, and closure may all be part of the bankruptcy process, but they are not stand-alone options. Therefore, A is the correct answer.