The Following Financial Information Was Summarized from the Accounting Records

question 111

Multiple Choice

The following financial information was summarized from the accounting records of Train Corporation for the current year ended December 31: The net income for Train Corporation is

• A) $83,180
• B) $35,940
• C) $48,390
• D) $60,840

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Definitions:

Apparent Authority

The appearance or assumption of authority based on the actions or statements of the alleged principal, leading others to believe someone has the authority to act on behalf of a company or individual.

Insanity

A mental disorder of such a severe nature that a person cannot distinguish fantasy from reality, conduct their affairs due to psychosis, or is subject to uncontrollable impulsive behavior.

Agency Formation

The legal process and principles involved in creating an agency relationship, whereby one party (the agent) is authorized to act on behalf of another (the principal).

Operation Of Law

Legal changes that occur automatically by application of law, without requiring action by any party.