Belinda and Franco Are Partners in a Jewelry Business

question 23

Multiple Choice

Belinda and Franco are partners in a jewelry business.Without Franco's knowledge,Belinda buys a ring from Janice for $2,200.Janice has no reason to question the transaction since she is a regular customer of the store and assumes Belinda has authority to buy her ring.When Franco finds out he is furious and does not want to honor the agreement.Which of the following is TRUE?

• A)Belinda acted with absolute authority and the partnership must honor the transaction.
• B)Belinda acted with actual authority and the partnership must honor the transaction.
• C)Belinda acted with implied authority and the partnership must honor the transaction.
• D)Belinda acted with apparent authority and the partnership must honor the transaction.

---

Definitions:

Fair Value

The financial return from unloading an asset or the expense of reallocating a liability in a formalized negotiation among market counterparts at the point of evaluation.

Economic Life

Refers to the expected period of time during which an asset is useful to the average owner.

Non-Cancelable

A term used in contracts and agreements indicating that the contract cannot be canceled or terminated by the parties involved without consequences.

Nonrenewable

Resources or energy sources that cannot be readily replaced by natural means at a pace quick enough to keep up with consumption.