A Contract into Which Both Parties Enter but in Which

question 51

Multiple Choice

A contract into which both parties enter but in which one or both of the parties can choose not to perform their contractual obligations is known as ________.

• A) illusory promise
• B) gift promise
• C) preexisting duty
• D) illegal consideration

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Definitions:

Private Corporations

Businesses owned by private individuals or entities, characterized by not having shares publicly traded on stock exchanges.

Board of Directors

A group of individuals elected to represent shareholders and govern over the activities and decisions of a corporation or organization.

Cost Method

an accounting technique used for recording investments in subsidiary companies where the investment is recorded at cost and adjusted only for dividends received.

Consolidated Financial Statements

Financial statements that aggregate the financial position and results of operations of a parent company and its subsidiaries.