Question

ABC Corp. is a financial disaster when the business fails to and assets are being divided...

ABC Corp. is a financial disaster when the business fails to and assets are being divided who receives first for preference please explain each answer

a)stockholders

b)long-term creditors

C)customers

D)employees

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Answer #1

Option C is the correct answer . Customerd are the outsiders of the company. Firstly company will set off the customer liability after that they will setoff any other liability.

Option A is the incorrect option : stockholders (equity) are the owner of the company . After setting off all the liabilities , surplus is shared by the shareholders.

Option B Long term creditors are the liabilities of the company . After setting off customer liability company will setoff the creditor liabilities.

Option D emploees are the backbone of the company . After paying customers , creditors . Company will make payment to the employees .

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