Answer (A) is correct . In a Chapter 7 liquidation or in a Chapter 11 reorganization, a voluntary or an involuntary petition is filed in the federal bankruptcy court. An involuntary petition must be joined by three or more creditors with unsecured claims of at least $11,625 if the debtor has 12 or more creditors. If there are fewer than 12, one creditor with a claim of at least $11,625 may file.
Answer (B) is incorrect because Both liquidation and reorganization may be commenced by either a voluntary or an involuntary petition.
Answer (C) is incorrect because Both liquidation and reorganization may be commenced by either a voluntary or an involuntary petition.
Answer (D) is incorrect because Both liquidation and reorganization may be commenced by either a voluntary or an involuntary petition.
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