Answer:
Step-by-step explanation:
Bankruptcy is a possible consequence for having more liabilities than assets.
When assets are more than liabilities, then we say that
Assets-Liabilities = Capital
For any business, or individual always capital should be a positive amount.
Sometimes, due to adverse circumstances in the financial sector, the business may have a situation where
liabilities exceed assets.
Liabilities - Assets = negative figure which means insolvency.
Which is also called Bankruptcy.
Thus Bankruptcy is a possible consequence for having more liabilities than assets.
