How Do the Courts Get Around the Basic Rule That

question 68

Essay

How do the courts get around the basic rule that a gratuitous promise is not enforceable if they feel that not enforcing such a promise would be unfair? Identify and briefly describe the requirements for this "get around."

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Definitions:

Cost of Goods Sold

Expenses directly linked to the creation of a company's sold goods, which include the costs of materials and labor.

Cash Paid

The total amount of cash disbursed by a company during a given period for various purposes, including operating expenses, asset purchases, or debt repayment.

Indirect Method

A way of preparing the cash flow statement where net income is adjusted for changes in balance sheet accounts to calculate cash flow from operating activities.

Cash Dividends

Payments made by a corporation to its shareholder members. It is the share of profits and retained earnings that the company pays out to its shareholders.