Lisa and Mandy Have a Contract

question 25

Multiple Choice

Lisa and Mandy have a contract. Mandy wants out of the contract; Carla Sue is willing to take Mandy's place, which is satisfactory with Lisa. When the Carla Sue for Mandy exchange is made, this is known as:

• A)third party beneficiaries.
• B)novation.
• C)accord and satisfaction.
• D)illegal activity.

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Definitions:

Cash Operating Expenses

Expenses that a company pays out in cash during the operating cycle, excluding non-cash expenses like depreciation.

One-Time Expense

An uncommon or non-recurring charge that companies incur, which does not reflect regular operating activities.

Straight-Line Depreciation

A technique for determining an asset's depreciation by uniformly distributing its cost throughout its lifespan.

Operating Cash Inflow

Cash received by a company during its normal business operations.