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Sagot :
In case of bankruptcy, the equity stockholders will be last to be paid. So, the correct answer is (b).
Through the legal process of bankruptcy, individuals or other corporations who have been unable to repay their creditors back can request partial or total relief from outstanding debts. Bankruptcy is imposed by a judicial order that is often requested by the debtors. By disposing assets to cover debts or by trying to come up with a repayment schedule, bankruptcy allows individuals who are unable to meet their obligations to start over.
Businesses in financial difficulty are also safeguarded by bankruptcy rules. A petition is submitted, either on behalf of the debtor, which happens more frequently or on behalf of creditors, which happens less frequent, to commence the bankruptcy process. All of the debtor's assets have been weighed and assessed, and a portion or all of the debt may be repaid with the help of the assets. When a company gets bankrupt it is the equity stockholders who gets paid at the end after paying all other claims.
Learn more about bankruptcy here:
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