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Albert Has a Contract to Buy 100 Tables from Bartholomew

question 41

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Albert has a contract to buy 100 tables from Bartholomew at a price of $50 a table. Five days before Bartholomew is to deliver the tables, he calls Albert to say that he is sorry but $50 won't cover his costs, and he will now need at least $75 a table. Albert agrees, because he needs the tables for his special sale. The modified contract is enforceable even though Albert isn't getting any new consideration, so long as Bartholomew is acting in good faith and the agreement to the new price is put in writing.


Definitions:

New-Stock Dividend

A new-stock dividend is a payment made by a corporation to its shareholders in the form of additional shares rather than cash.

Stock Repurchases

The act of a company buying back its own shares from the marketplace, reducing the amount of outstanding stock.

Capital Structure

The mix of different forms of funding used to finance a company's operations and growth, including debt and equity.

Income Tax

A tax levied by governments on the income generated by businesses and individuals within their jurisdiction.

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