Question

In December 2008, Hawaiian Telcom took action to strengthen its balance sheet by reducing debt. Although the company continued to operate, its creditors could not collect their debts or loan payments that were due prior to the legal action that the company took. However, on November 30, 2009, the company had $75 million in cash on hand.

This is an example of: O Reorganization O Liquidation

Answer 1

Reorganization

Step-by-step explanation:

In liquidation, company technically no longer functions and creditor takes control of the company's assets and sells them to pay off the debt. But in reorganization debtor does not control of business, operates and restructures its debt obligations.