When one file bankruptcy, the balance sheet of the organization declares losses, and in the case of a sole proprietorship, the owner would have to cover the deficit. In this case, assets are 100,000, and liabilities are 175,000. This leaves a deficit of -75,000. This amount will be paid in a bankruptcy by personal assets, which in this case are the stocks. The proprietor would have to relinquish 75,000 of his or her General Motors stock to ensure the liabilities were covered.
