Which of the Following Statements Is True of Fraud

question 50

Multiple Choice

Which of the following statements is true of fraud?

• A) Fraud is only applicable for the intentional misrepresentation of property.
• B) The victim of a fraud need not be injured in any way for it to be a tort as long as the victim can prove that the defendant committed the fraud.
• C) Fraud can be proved by giving evidence that one was harmed by another failing to disclose a material hidden fact.
• D) Fraud is only applicable in cases involving financial transactions in business settings.
• E) Fraud is always a tort and not a crime.

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Definitions:

Mutual Agency

A principle in partnership where each partner has the authority to bind the partnership in contracts and agreements, affecting all partners.

Articles of Partnership

A document that formalizes an agreement between parties to enter into a business partnership, outlining the rights, responsibilities, and capital contributions of each partner.

Profit and Loss Ratio

Typically refers to the profit margin, which measures the efficiency of a company in generating profits from its operations, calculated as net income divided by revenue.

Closing Entry

Journal entries made at the end of an accounting period to transfer the balances of temporary accounts to permanent accounts, preparing the books for the next period.