ABC,IncCalls the Widget Corporation of America to Order 400 Widgets

question 65

Multiple Choice

ABC,Inc.calls the Widget Corporation of America to order 400 widgets at $2 a widget.Widget accepts the oral order and then sends out an order confirmation form,with the pre-printed name Widget Corporation of America on the top of the form.The form states that an order has been received for "300" widgets and that it will be filled promptly.

• A)The confirmation fails to meet the UCC writing requirement, because it isn't signed.
• B)ABC can enforce the contract for 300 widgets, but not for 400 widgets.
• C)If ABC signs and returns the form, it will be able to sue for the extra 100 widgets later.
• D)The contract is enforceable for 400 widgets, because it has been partially performed.

Understand the concept and application of the percentage-of-receivables method and the direct write-off method for estimating bad debts.

Know how to adjust the Allowance for Doubtful Accounts and calculate bad debt expense under different estimation methods.

Identify the impact of using national credit cards on the accounting process of retailers.

Recognize the implications of selling receivables to a factor, including the treatment of service charges.

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Definitions:

Linear Island Chain

A series of islands arranged along a straight or nearly straight line, often formed by volcanic activity along a submarine ridge.

Fracture Zone

An area in oceanic or continental crust characterized by cracks and faults due to tectonic stresses, often associated with earthquake activity.

Plate Boundary

The edges where tectonic plates meet, which can be sites of earthquakes, volcanoes, and mountain building.

Pacific Ring

A region encircling the Pacific Ocean characterized by active volcanoes and frequent earthquakes, known as the Pacific Ring of Fire.