P Enters into a Contract with a According to Which

question 21

Multiple Choice

P enters into a contract with A according to which A is to deliver a crate of P's watermelons to a customer in another State by a certain date.The delivery is delayed by flooding, and rather than allow the watermelons to perish, A sells them to local buyers along the way.P sues A for compensation.Could A successfully argue that they had the authority to sell the watermelons on P's behalf?

• A)Yes, because A had express authority to sell the watermelons.
• B)No, because A did not have actual authority to sell the bananas.
• C)No, because A should have tried to contact P to get instructions.
• D)Yes, because A had authority by necessity to sell the watermelons.

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Definitions:

External Financing

Funds raised from outside the company, typically through borrowing or selling equity.

Dividend Payout

Dividend payout refers to the portion of a company's earnings distributed to shareholders as dividends.

Profit Margin

A financial metric used to assess a company's profitability by calculating the percentage of revenue that exceeds the costs of goods sold.

Retained Earnings

The portion of a company's profits not distributed as dividends but reinvested in the business.