During liquidation, which of the following is considered a creditor?

During the liquidation of a partnership or business entity, creditors are defined as those who are owed money by the firm. This encompasses a broad range of individuals and entities that have provided financial resources or contracted obligations to the firm. In this scenario, partners who have lent money to the partnership are creditors because they have a financial claim against the partnership's assets just like external creditors.

In addition to the partners who have lent money, external creditors—such as banks, financial institutions, and other entities that provided loans or credit—also qualify as creditors. This inclusion reflects the principle that any party that has a legal right to receive payment or compensation from the partnership is considered a creditor during the winding up of the entity's affairs.

While employees may have claims related to unpaid wages, they are not classified as creditors in the same sense during liquidation unless a formal arrangement like wage claims is set up. Suppliers may have similar situations, but they are typically seen as creditors within a wider eligibility. Therefore, recognizing both partners who lend money and external creditors captures the full scope of those who have claims against the firm's assets, making this choice the correct one.