Assignment Directions:

Get into groups of three to four students and decide which business you would like to run.

Next, write on a piece of paper what the business does, the type of equipment it needs to run its business, and the type of customers it has.

Next, make a list of the creditors that the business must repay, such as:

• banks (lines of credit)
• mortgage company (real estate)
• trade creditors (equipment, supplies, inventory)
• employees
• shareholders or partners

Then make your business insolvent and identify the best method to repay its creditors:

• Chapter 7
• Chapter 11
• Out-of-Court workout
• Assignment for Benefit of Creditors

Finally, go online and look up which court your business will actually file either the bankruptcy petition in federal district court or the state court where you will file the final accounting (which city, county and state).