Bob Claims That Carla Breached Their Contract for Tutoring

question 23

Multiple Choice

Bob claims that Carla breached their contract for tutoring. Carla responds that she never intended to enter into a contract with Bob. The intent to enter into a contract is determined with reference to

• A) ​the intentional theory of contracts.
• B) ​the objective theory of contracts.
• C) ​the personal theory of contracts.
• D) ​the subjective theory of contracts.

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Definitions:

CCA Rate

Capital Cost Allowance Rate, the rate at which a business can claim depreciation on capital assets for tax purposes in certain jurisdictions.

Present Value

The current value of a future sum of money or stream of cash flows given a specified rate of return.

Depreciation Tax Shield

The reduction in taxable income for businesses that results from claiming depreciation expenses, thereby lowering tax liabilities.

Break-Even Lease Payment

The lease payment amount at which the cost of leasing equals the cost of owning, resulting in no net profit or loss.