Samuel Entered into a Contract with AE Lukey Inc

question 33

Multiple Choice

Samuel entered into a contract with AE Lukey Inc.That contract required both parties to perform services.It is now six months later.The contract is executed on one side and executory on the other.Which of the following statements is most likely to be TRUE?

• A)One of the parties has sued, but the other party has not.
• B)If the parties wish to modify the terms of their contract, they may effectively do so by using the process of accord and satisfaction but not the process of rescission.
• C)One party satisfied a subsidiary obligation under a conditional contract.
• D)One party has signed the contractual documents, but the other party has not done so.
• E)If the parties wish to modify the terms of their contract, they may effectively do so by using the processes of variation or novation without new consideration.

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Definitions:

Fixed Cost

Expenses that do not change with the level of production or sales, such as rent, salaries, and insurance.

Variable Cost

Costs that change in proportion to the good or service that a business produces.

Profit

The financial gain obtained when the amount of revenue gained from a business activity exceeds the expenses, costs, and taxes involved in sustaining the activity.

Market Price

The current price at which a good or service can be bought or sold in a market, determined by the forces of supply and demand.