Which of the Following Is Not Correct with Regard to Consideration

question 50

Multiple Choice

Which of the following is not correct with regard to consideration?

• A) In a unilateral contract, a promise is exchanged for an act or forbearance to act.
• B) In a bilateral contract, there is an exchange of promises.
• C) Legal sufficiency is always related to adequacy of consideration.
• D) Consideration can be a legal detriment.

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Definitions:

Issuing Corporation

A company or entity that offers its securities for sale to investors to raise capital.

Interest Expense

The cost incurred by an entity for borrowed funds, reflected as a charge against earnings on the income statement.

Income Statement

A financial statement that reports a company's financial performance over a specific accounting period, detailing revenues, expenses, and profits or losses.

Convertible Bond

A convertible bond is a type of bond that the holder can convert into a specified number of shares of common stock in the issuing company, usually at certain times during its life.