The Doctrine of Frustration

question 2

Multiple Choice

The doctrine of frustration

• A)if not applied,discharges the plaintiff from her or his contractual obligations.
• B)can be applied in cases where the subject matter did not exist at the time of the agreement.
• C)only applies where there is a Frustrated Contracts Act.
• D)is a practical and reasonable solution to be imposed by a court under extreme circumstances that were not contemplated by the contracting parties.
• E)could be applied successfully as a defence in a case where honouring contractual obligations would bring hardship upon the promisor.

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Definitions:

Immediate Recognition

The accounting practice of recording revenues or expenses as soon as they are incurred, without deferral.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold in a company, including material and labor costs.

Cost of Goods Manufactured

The total production cost of goods completed during a specific accounting period, including raw materials, labor, and overhead.

Finished Goods

Products that have completed the manufacturing process and are ready for sale to customers.