Jim Contracted with Kevin to Serve as a Guide for Kevin

question 62

Multiple Choice

Jim contracted with Kevin to serve as a guide for Kevin on his three-week fishing trip to Canada.The contract was made on April 1 with the trip to begin on June 1.On May 1, Kevin notified Jim that he had changed his mind and would be unable to make the trip.He also refused to pay Jim any compensation.In this case:

• A)because the contract is executory, Jim has suffered no damages, and Kevin has no obligation to pay any compensation.
• B)Kevin has anticipatorily repudiated the contract and is liable to Jim for damages.
• C)Jim is discharged from his duty to serve as guide, but he must wait until after June 1 to bring suit against Kevin.
• D)All of these.

---

Definitions:

Ending Inventory

The financial value of items up for sale at the end of a fiscal period.

Lower of Cost or Market

An accounting principle requiring companies to value and report their inventory at the lower of the original cost or its current market price.

Inventory Item

An individual product or article that is held in stock by a business for the purpose of resale or production.

Inventory Value

The total cost or market value of all the goods held by a company meant for sale.