0
Why a business have creditors
Wiki User
∙ 12y ago
Add your answer:
Earn +20 pts
What is liquidation in business?
Liquidation in business is when the business is closing or bankrupt, and assets are sold to pay creditors. Any left over money after creditors are paid is distributed among shareholders.
What is trade creditors?
Trade creditors are the person's who lend for business or stock market. There are also weekly and daily loans in India.
Why does a business have creditors?
A creditor may supply stock (parts, materials, etc) to a business. This is usually on a credit period of 30 or 90 days before the business is expected to pay for the stock. This credit period will allow a business to, hopefully, produce and sell finished goods, and so be able to pay its creditors on time.
What is a liquidation policy?
when a business or firm is terminated or bankrupt its assets are sold and the proceeds pay creditors
Where can one obtain a business consolidation loan?
There are many creditors that offer business consolidation loans. In Australia, you can try websites such as Australian Lending Center and Bank of Melbourne.
What is business climate?
A business that has stopped operating, with a loss to creditors.
What is liquidation in business?
Liquidation in business is when the business is closing or bankrupt, and assets are sold to pay creditors. Any left over money after creditors are paid is distributed among shareholders.
Explain the need of different stakeholder in a business owner shareholders customers employees management suppliers creditors and government?
The need of stakeholders are to now the business growth is profitable, customers are satisfied in order for him to receive his dividend.
What is trade creditors?
Trade creditors are the person's who lend for business or stock market. There are also weekly and daily loans in India.
What is the Bankruptcy Code?
The Bankruptcy Code refers to a business filing bankruptcy. If a business is unable to pay it's debt or pay it's creditors, the business or it's creditors can file bankruptcy. Upon filing bankruptcy, the business ceases operation, a trustee sells the assets, and then gives the proceeds to it's creditors.
What is Creditors Collection Period?
The creditors' payment period is an activity ratio. It measures the average amount of days the business takes to pay its creditors i.e. suppliers. The more days available to pay the better.
Who has first preference to assets in case a business fails?
long-term creditors
What could happen to a business facing insolvency?
A business facing insolvency can declare bankrupcy, in which case it will close and its assets will be auctioned off to pay off creditors. A business facing insolvency can declare bankrupcy, in which case it will close and its assets will be auctioned off to pay off creditors.
Why does a business have creditors?
A creditor may supply stock (parts, materials, etc) to a business. This is usually on a credit period of 30 or 90 days before the business is expected to pay for the stock. This credit period will allow a business to, hopefully, produce and sell finished goods, and so be able to pay its creditors on time.
Why creditors would be interested in the balance sheet of a business?
Creditors are interested in balance sheet to check that how much money company has already taken as a loan from other creditors and how much assets are pledged and will company be able to return credit or not.
Why businesses need accounts?
Businesses need accounts to control the money of the business. For example, from the Financial Statement (Profit and Loss Statement, Owners Equity Statement, Balance Sheet, Cash Flow) the manager can see the strength and weaknesses of the business. Whether the business has a lot of debtors (account receivable) or creditors (account payable). It is also important to plan for the business such as whether it is need to be expand or not. The decision can be make by knowing how much capital or cash that the business have.
If you file bankruptcy because of personal debts related to your business then sell your business after the bankruptcy can the courts take your proceeds?
== == YES. All of your property is considered in a bankruptcy. Your creditors have every right to get at ALL of your property including your business assets. I would be very surprised if the court didn't order the sale of the business to satisfy the creditors demands.
