Carl and Debra Orally Agree on the Sale of Carl's

question 45

Multiple Choice

Carl and Debra orally agree on the sale of Carl's Electrical Supplies Company to Debra and jot down the terms on the back of one of Carl's blank invoices, which they both sign. A written memorandum evidencing an oral contract that would otherwise be unenforceable must contain​

• A)all terms.
• B)the essential terms.
• C)the preliminary terms.
• D)the qualitative terms.

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Definitions:

Matching Principle

An accounting principle that requires expenses to be matched with the revenues they helped to generate in the same period.

Amortization

The gradual reduction of a debt over a period of time or the spreading out of capital expenses related to intangible assets over their useful life.

Matching Principle

An accounting principle that dictates expenses should be recognized in the same period as the revenues they helped generate.

Depletion

The accounting process of allocating the cost of natural resources over their productive life, used in industries like mining, timber, and oil extraction.