Fact Pattern 16-1 Medical Accounts Collection Enters into a Contract

question 38

Multiple Choice

Fact Pattern 16-1 Medical Accounts Collection enters into a contract to employ Natalie as a billing manager for two years. During the first year, Natalie is often absent without explanation and when present fails to adequately do her job.
Refer to Fact Pattern 16-1. Natalie's performance most likely

• A) discharges Medical from the contract .
• B) has no effect on Medical's performance.
• C) changes Medical's duties under the contract.
• D) suspends Medical's duty to perform .

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Definitions:

Installment Note

A debt instrument that requires the borrower to make regular payments (installments) of principal and interest over a set period until the total debt is paid.

Journal Entry

A record in the books of accounts that represents a transaction and its effect on various accounts.

Interest Expense

The financial charge for an entity using borrowed capital over a time frame.

Notes Payable

Short-term or long-term liabilities representing amounts owed on written promises to pay a specific sum of money at a future date.