Halle and Rose Enter into a Contract in Which Rose

question 21

Multiple Choice

Halle and Rose enter into a contract in which Rose agrees to sell her property to Halle so Halle can build a hotel. Maria owns the restaurant next door and will benefit from the opening of the hotel because it will bring in many new customers. Rose subsequently breaches the contract so Halle cannot buy the property and build the hotel. Can Maria sue Rose for breach of contract?

• A) Yes, because Maria was an intended beneficiary to the contract.
• B) Yes, because Maria was an intentional beneficiary to the contract.
• C) Only if Halle does not sue.
• D) Only if Halle also sues.
• E) No, because Maria was an incidental beneficiary to the contract.

---

Definitions:

Financial Statements

A set of formal documents tracking the financial activities, status, and cash flows of a business, providing insight into its financial health over a specified period.

Accrual

An accounting method where revenue and expenses are recorded when they are earned or incurred, regardless of when the cash is actually received or paid.

Interest Expense

The amount an entity pays for the use of borrowed funds throughout a certain duration.

Net Cash Flow

The amount of cash generated or used by a company in a given period, calculated as the sum of cash flow from operating, investing, and financing activities.