A Contract Provision Stating That One of the Parties Shall

question 52

Multiple Choice

A contract provision stating that one of the parties shall not be liable for damages in case of a breach is called a(n) __________ clause.

• A) liquidated damages
• B) exculpatory
• C) waiver.
• D) due process

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Definitions:

Residual Income

Income that continues to be generated after the initial effort has been expended, or in managerial accounting, the operating income that an investment center earns above the minimum required return on its operating assets.

Minimum Required Rate

The lowest return on investment that an investor is willing to accept, considering the risk involved.

Residual Income

The net operating income an investment earns above the minimum rate of return expected by its investors or company management.

Turnover

The rate at which inventory is sold and replaced or an employee leaves and is replaced within a company.