Answer:
Liquidation of a business involves selling all of the firm's fixed assets (such as machinery, properties and inventory), thus liquidating its assets. Upon repayment of the company's debt, any profits are paid to the company's owner. Upon liquidation, the company ceases to exist.
Liquidation of a business can be done as voluntary liquidation initiated by the business owners or as forced liquidation which can be initiated by public authorities if the company does not comply with the legislation, such as timely filing of the annual report.
