Small business bankruptcy under chapter7
Small business bankruptcy is where after you find that you can not pay your debts anymore, you go under the protection of the law such that you can be released from all debt obligations. Under chapter 7 which is also applicable in business administration of bankruptcy for big businesses, this is where all the assets of the company or business in question are sold and the creditors settled on a pro rata basis.
The bankruptcy court appoints a trustee who handles all the sale and redistribution of assets and money to all the creditors. It is only after all assets are dispensed with and when the trustee has been paid that the business owner is called back to the court and he/she is lawfully released from any further obligation. Chapter 7 is even applicable in sole proprietorship businesses. There is no need of a business administration company here.