Terra Corp What Is Terra Corp

question 2

Multiple Choice

Terra Corp. purchased a new enterprise software system and incurred the following costs: $$\begin{array} { | l | r | } \hline \text { Cost of the system } & \$ 800,000 \\\hline \text { Installation of system } & 5,000 \\\hline \text { Testing of system } & 6,000 \\\hline \text { Initial training of employees } & 9,000 \\\hline\end{array}$$ What is Terra Corp.'s basis in the software system?

• A) $800,000
• B) $805,000
• C) $811,000
• D) $820,000

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Definitions:

Ultra Vires

Acts or decisions made by an entity that are beyond the powers conferred by its constitution, charter, or laws.

Lend Money

The act of giving money to another party with the expectation that it will be paid back, usually with interest, over time.

Good Faith

Acting with honesty and sincerity without any intention to defraud or seek unfair advantage.

Model Business Corporation Act

A set of model statutes prepared by the American Bar Association to provide a standard framework for the incorporation and governance of corporations in the United States.