In Which of the Following Circumstances Will an Agent's Act

question 58

Multiple Choice

In which of the following circumstances will an agent's act not generally be binding on the principal because the agent has no authority (leaving aside contexts in which the agent has apparent authority) ?

• A)When the agent was given verbal authority by the principal to do the act.
• B)When the principal has ratified the act verbally.
• C)When the act was something necessary or appropriate given the scope of the agent's actual authority although they had no express authority.
• D)When the agent's authority was given verbally in circumstances in which legislation required the authority to be given in writing.

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Definitions:

Payroll Expense

Payroll expense is the total amount of wages, salaries, and other compensation that a business pays to its employees over a specific period.

Contra Account

A type of account used in accounting to reduce the value of a related account, creating a net balance that reflects the correct value of the asset or liability.

Cash Flow Problems

Situations where a business struggles to manage the timing and amounts of cash inflows and outflows, affecting its ability to meet financial obligations.

Federal Regulations

Laws established by federal agencies that dictate the conduct of individuals, businesses, and other entities.