MicroWare Is a U

question 20

Essay

MicroWare is a U.S.company based in Utah.It is negotiating to sell $4 million worth of computer goods to a French company,Baranger.MicroWare's attorney suggests that payment be by a letter of credit.What is a letter of credit and why does MicroWare's attorney recommend payment by letter of credit?

---

Definitions:

Petty Cash Voucher

A document used to record and authorize the payment of small, immediate expenses from a petty cash fund.

High-Cost Items

Products or services that have a significantly higher price due to their quality, complexity, or brand reputation.

Specific Identification

A method for inventory costing and valuation that tracks the cost of individual items or batches of items.

First-In, First-Out

An inventory valuation method where goods purchased or produced first are sold or used first.