If the Buyer Has Paid for the Goods in Advance

question 41

Multiple Choice

If the buyer has paid for the goods in advance but revokes his acceptance when the goods arrive, he:

• A) can resell the goods.
• B) must prove the nonconforming defect was known at the time of the original acceptance.
• C) return them within ten (10) days and wait for the refund.
• D) may retain possession of the goods as security until the refund has been paid.

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Definitions:

Comparative Balance Sheets

Comparative balance sheets present the financial position of a company at two different points in time, allowing for analysis of changes and trends.

Inventory

The sum of all products and materials possessed by a firm, intended for either reselling or manufacturing.

Statement of Cash Flows

A financial report detailing the inflow and outflow of cash and cash equivalents for a business.

Direct Method

A cash flow statement preparation technique that lists all major operating cash receipts and payments for the period.