McManus Promises to Pay Gooding $150 If Gooding Repairs His

question 10

Multiple Choice

McManus promises to pay Gooding $150 if Gooding repairs his car. A day later Gooding repairs the car to McManus's satisfaction. This is an example of a

• A) bilateral contract.
• B) quasi contract.
• C) void contract.
• D) unilateral contract.

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Definitions:

Adjusting Entry

A journal entry made at the end of an accounting period to update account balances to reflect accurate and fair financial statements.

Closing Entry

An accounting entry made at the end of an accounting period to transfer balances from temporary accounts to permanent accounts.

Income Summary

An account used in the closing process that summarizes revenues and expenses for a period, transferring the net income or loss to the owner's equity.

Revenue

The aggregate financial gain acquired by a company from its essential sales activities involving goods or services.