Oxford Management Inc Is a Management Consulting Firm

question 60

Multiple Choice

Oxford Management Inc is a management consulting firm.It has hired Jerome as its agent to buy new computers for its offices across the country.Jerome owns 10 computers, which are ideal for Oxford's needs.Oxford is a valued client, and he decides to sell the computers to Oxford for a price which is $10 000 less than their market value.As agent for Oxford, he decides to buy the computers for this price from himself.Which of the following is TRUE?

• A)Jerome can never buy the computers for Oxford from himself because his personal interest as the seller would conflict with his duty to obtain the best price for Oxford.
• B)Jerome can buy the computers for Oxford from himself if Oxford consents to the sale.
• C)Jerome can buy the computers for Oxford from himself so long as he is satisfied that the price is fair.
• D)Jerome cannot buy the computers for Oxford from himself if there is an alternative supplier willing to sell the computers at their market value.
• E)Jerome cannot sell his own computers to Oxford even if Oxford consents to the sale.

---

Definitions:

Calendar Year

The one-year period that begins on January 1 and ends on December 31, used for most civil purposes and by many businesses as a fiscal year.

Work Week

A work week refers to the standard period of time during which an employee is expected to work, usually defined by the employer, and often consisting of 40 hours.

FICA-OASDI

Taxes collected under the Federal Insurance Contributions Act for Old Age, Survivors, and Disability Insurance, commonly known as Social Security.

Cumulative Earnings

The total amount of net income a company has earned over a specific period until the present date, not including dividends.