explain whay some businesses that have filed bankruptcues continue to operate for many years?

Answer 1

Filing for Chapter 11 Bankruptcy as businesses do is a restructuring of debt. They are basically saying that they can not afford to make all of their payments as they stand and need to come to new payment terms. After the payments are all made they come out of Bankruptcy. Business can continue as usual throughout the Bankruptcy case and afterward.

Answer 2

Bankruptcy does not mean that the company is broke. Filing bankruptcy is a way for companies to get out of massive debt. Or it is a way for companies to manage a heavy debt burden while being able to restructre the company to become more profitable. On rare occasions some companies actually are broke and facing the very real probability of going under. Sometimes filing bankruptcy can help to save the company. Most times with a doomed company it does not.
There are several types of filings for backruptcy chapter 13, chapter 11, and i believe chapter 7.
Some of these are actually designed for financial restructring. Those are typically chapter 11 and 13. whereas chapter 7 is designed for a liquidation of assests. Basically company is going under. For more info check out the link I provided. Gives better details on bankruptcy in the usa and other countries and explains it pretty well.

Answer 3

Lots of good answers so far.

In a nut shell bankruptcy is just another form of doing business.

The airlines are a classic case of bankruptcy and business as usual or so it seems.

I believe it is chapter 7 where the bankruptcy client forfeits everything and all assets are auctioned off. That pretty much ends the business right then and there.

There is another chapter that can be filed maybe the restructuring one.. where all assets are re-analyzed for current fair market value. Labor contracts can legally be broken. Dead assets are placed on the chop block I mean auction block.

This is where the business maintains the business but legally writes off massive un-repayable debt.

Answer 4

Bacause they employ many people usually, the government will step in and keep the debtors off of them until they can get their bills under control. Once they are debted down, usually with some buyouts, forced & voluntary retirements, sell of excess properties, they get out of bankruptcy court.

Answer 5

They redisign the company in a way that they can remain in business, or get bought out buy another company who continues to operate under the same name.

Answer 6

Loopholes in the bankruptcy system as well as the internal revenue service

Answer 7

politics