Which of the Following Is an Example of an Executory

question 108

Multiple Choice

Which of the following is an example of an executory contract?

• A)A warranty obligation on a product sold.
• B)Interest accrued on an outstanding loan.
• C)An agreement to purchase inventory next month.
• D)The purchase of goods from a supplier.

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Definitions:

Average Collection Period

The average time it takes for a business to receive payments owed by its customers, indicating the effectiveness of its credit and collection policies.

Balance Sheet

A statement that presents an organization's assets, liabilities, and the equity of its shareholders at a distinct point in time.

Sales On Account

Transactions where goods are sold but payment is deferred to a later date.

Cost Of Goods Sold

The immediate expenses related to the manufacturing of products sold by a business, encompassing costs for both materials and labor.