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Asked by arihant on :Feb. 28, 2018

Liquidation is the last resort option for a busin…

Liquidation is the last resort option for a business organisation. Is it correct?

Liquidation is the last resort option for a business organisation. Is it correct?

0

Jeeba Mar. 09, 2018

Liquidation of closing the business operation and selling its assets. When a company realises that the said unit of business could not perform well, they may dissolve or liquidate it.

It is considered as the last resort because it leads to serious consequences such as loss of employment for workers and other employees, termination of opportunities a firm could pursue, and the stigma of failure. The company management, government, banks and financial institutions, trade unions, suppliers, creditors, and other agencies are extremely reluctant to take a decision, or ask for liquidation.

So it is correct to say that liquidation is the last resort option for a business organisation.

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