X Contracts with Y to Purchase 1000 Sacks of Grain

question 23

Multiple Choice

X contracts with Y to purchase 1000 sacks of grain to be delivered on 1 September.Y however delivers the grain to X on 8 September and as a result of a drop in grain prices during the delay, X can only sell the grain at half the price that he would have been able to if Y had delivered the grain on time.The loss to X arising out of the breach of contract is classified as:

• A)indirect loss.
• B)consequential loss.
• C)direct loss.
• D)nominal loss.

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Definitions:

External Users

Individuals or entities outside of a company who have an interest in the financial information of that company, such as investors, creditors, and regulatory agencies.

Financial Accounting

The field of accounting that focuses on preparing financial statements for external users, such as investors, creditors, and regulatory agencies.

External Users

Individuals or entities outside a company, such as investors, creditors, regulators, and customers, who use its financial information for making decisions.

External Auditing

The examination of financial records and statements by an independent third party, to ensure accuracy and adherence to accounting standards.