Lois Was the Agent of Lester, Who Owned a Store

question 182

Multiple Choice

Lois was the agent of Lester, who owned a store in Walton, Iowa. While Lester was away on vacation, the Mississippi River reached record flood. As an agent, Lois only had permission to engage in sales at the store and purchase certain items. Faced with the prospect of losing all goods, Lois shipped Lester's inventory to a storage facility 200 miles away, out of the path of the flood waters. This incurred costs, but saved the inventory. Lois acted in:

• A) violation of her duty of loyalty
• B) violation of her duty of obedience
• C) violation of her duty of accounting
• D) accordance with her duty of accounting
• E) accordance with her duty of reasonable care

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Definitions:

Purchased Patent

An asset representing the right to exclusively use, make, sell, or distribute an invention or discovery, acquired through purchase rather than original creation.

Legal Life

The duration for which an asset is legally permitted to be used or the period a legal agreement is effective.

Amortized

The process of gradually reducing a debt through periodic payments of principal and interest over a set term.

Ordinary Repairs

Expenditures for routine maintenance and upkeep of assets, charged as expenses to ensure the operational efficiency of an asset.