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Toy company files Chapter 7 bankruptcy

Toys have played a significant role in just about every child's life. However, making toys is a business just like any other industry in Texas and elsewhere. This means that a toy company can find itself facing financial hardship that could force it to go out of business. Toymaker Summit Products LLC found this out the hard way and has recently filed for Chapter 7 bankruptcy.

The toy company reported over $6.8 million worth of liabilities on its bankruptcy petition submitted to the court. Summit Products also listed $1.6 million worth of assets. Everlasting Toys Co. Ltd. reportedly holds $834,946 in unsecured and non-priority claims. The bankruptcy filing also reported $796,581 owed to Eastern Progress.

The company had started business in 1995 and only sold directly to customers at the time. However, the company began its retail business in 2000 and also began selling to mass retailers. Some of its clients included Wal-Mart, Toys-R-Us, Target and other national retailers. Also, many of its products were sold heavily online on websites such as Amazon.

On the other hand, businesses are not the only ones feeling the financial aftereffects of the recent recession in Texas and the rest of the country. Individuals and families may also be having a hard time financially due to the recent tough economic period that caught many people by surprise. This is why a Chapter 7 bankruptcy is also available for individuals to clean their financial slate. This type of bankruptcy may have the power to discharge unsecured debts as well as restructure other debts.

Source: Birmingham Business Journal, "Summit Products files Chapter 7 bankruptcy", Antrenise Cole, April 3, 2014

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