Which of the Following Scenarios Would Not Be Likely to Render

question 46

Multiple Choice

Which of the following scenarios would not be likely to render a contract unenforceable because of a presumed lack of consent by one of the parties?

• A)A mistake about a fundamental aspect of the agreement which mistake is unfairly taken advantage of by the other party.
• B)A contract entered into as a result of inappropriate pressure applied by one party to the other.
• C)Where a party entered into a contract because the other party unfairly used his influence to coerce the consent.
• D)Where a party entered into a contract knowing that they did not have sufficient funds to meet the agreed price for the goods or services.

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Definitions:

Bad Debts Expense

An estimated expense that represents the cost of accounts receivable that a company does not expect to collect.

Allowance for Doubtful Accounts

An estimation of the accounts receivable that a company does not expect to collect.

Percentage of Receivables

An accounting method used to estimate the value of a company's bad debts based on a percentage of the accounts receivable.

Normal Balance

The usual balance side (debit or credit) of an account in double-entry bookkeeping, determined by the type of account (asset, liability, equity, revenue, or expense).