Mary Goes into a Store in Which She Sees a SALE

question 40

Multiple Choice

Mary goes into a store in which she sees a SALE sign.While she is looking round,she notices that a sign that says 50 percent off has been placed against a pair of knee-high boots.She takes the pair of boots to the cashier.The cashier refuses to sell the boot at the 50 percent discount.Which of the following is true?

• A)The cashier is in breach of contract.
• B)Mary is not entitled to a 50 percent discount because the sign was not an offer.
• C)The conduct of the store amounts to false advertising and Mary will be entitled to the 50 percent discount.
• D)Mary is entitled to a 50 percent discount because that boots were advertized as being sold at a discount of 50 percent.
• E)The store is in breach of contract.

---

Definitions:

Measurement Date

The specific date at which the fair value of assets and liabilities is determined for accounting purposes.

Unobservable Inputs

Inputs for which market data are not available and that are developed using the best information available about the assumptions that market participants would use when pricing the asset or liability.

Fair Value Hierarchy

A system that prioritizes the inputs used in the valuation of assets and liabilities for financial reporting purposes.

Equity Instrument

is a financial instrument that evidences ownership interest in an entity, such as shares of common stock.