​ Mark, a Civil Engineer, Entered into a Contract with David

question 8

Multiple Choice

​ Mark, a civil engineer, entered into a contract with David. As per the contract, Mark agreed to design and build a house for David for a specified fee. Mark provided David with an estimation of the total cost and the contract was mutually agreed upon. However, during construction, when Mark increased the price due to a miscalculation on his part, David refused to pay the amount. This scenario is an example of a mistake.

• A)mutual
• B)collective
• C)collateral
• D)unilateral

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Definitions:

Cash Budget

A financial plan that projects future cash flow by estimating incoming cash receipts and outgoing cash payments.

Loans Outstanding

The total amount of borrowed money that is still owed to lenders.

Budgeted Purchases

The estimated amount of purchases a company plans to make in a future period, often part of a budgeting process.

Budgeted Ending Inventory

The estimated value or quantity of inventory that a company plans to have on hand at the end of a financial period.