When One Party Fails to Follow the Terms of a Contract

question 13

Multiple Choice

When one party fails to follow the terms of a contract, the party has committed a(n)

• A) obligation violation.
• B) breach of contract.
• C) termination by association.
• D) nonperformance endorsement.

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Definitions:

Bonds Payable

Long-term liabilities representing money a company must pay back to bondholders, typically including principal and interest.

Semiannual Interest

Interest that is calculated and paid twice a year on an investment or loan.

Bond Discount

The contrast in value between what a bond is worth in terms of its face value and the lesser amount it is sold for in the market.

Interest Method

A method used in finance to calculate the interest portion of a payment or the return on an investment over a period of time.