What Is the Legal Definition of a "Guarantee

question 18

Multiple Choice

What is the legal definition of a "guarantee"?

• A) a fair contract formed by one advantaged party over another
• B) a pledge evidencing the capacity to enter into legally binding contracts
• C) a pledge to pay another's liability in the event of default of such duty
• D) a contract made enforceable by performance over a period of time

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Definitions:

Accelerated Depreciation

A method of depreciation used for accounting or income tax purposes that allows higher deductions in the earlier years of the useful life of an asset.

Depreciation Expense

The systematic allocation of the cost of a tangible asset over its useful life, reflecting the asset's consumption, wear and tear, or obsolescence.

Residual Value

The estimated value of an asset at the end of its useful life, important in calculating depreciation and lease contracts.

Estimated Useful Life

The anticipated period over which an asset is expected to be used before it is fully depreciated.