Fact Pattern 14-1 Daily Bread Bakeries, Inc., Contracts to Buy All of Its

question 20

Multiple Choice

Fact Pattern 14-1
Daily Bread Bakeries, Inc., contracts to buy all of its ingredient requirements for bread making, at a certain minimum per year, from Enriched Flour & Grain Corporation for six years. After three years, Daily Bread tells Enriched that it plans to sell its assets to Flat Bread Shops, Inc. Flat Bread refuses to assure Enriched that it will continue Daily Bread's contract.
-Refer to Fact Pattern 14-1.Enriched can​

• A) ​assign its rights under the contract but cannot terminate it.
• B) ​terminate the contract and seek damages.
• C) ​suspend performance under the contract until Enriched is fully paid.
• D) ​do nothing.

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Definitions:

Fair Values

An estimate of the market value of an asset or liability, based on current prices in an active market.

Acquired Entity

A company that has been purchased or taken over by another entity.

Brand Name

The distinctive title or symbol used to identify a product, service, or company, distinguishing it from competitors.

Cost Model

An accounting method used to value an asset based on its historical cost minus any accumulated depreciation and impairment losses.