A(n)______ Exists When Parties Form an Agreement from Their Actions

question 56

Multiple Choice

A(n) ______ exists when parties form an agreement from their actions rather than from a specific oral or written agreement.

• A) implied contract
• B) express contract
• C) personal contract
• D) quasi-contract

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Definitions:

Accounts Receivable Turnover

A financial metric that measures how efficiently a company collects revenue from its credit customers, calculated as sales divided by the average accounts receivable.

Days' Sales in Receivables

A financial metric that measures how quickly a company collects on sales made on credit, indicating the average number of days it takes to convert receivables into cash.

Allowance Method

An accounting technique used to estimate the amount of uncollectible accounts receivable and adjust for bad debts.

Uncollectible Accounts

Accounts receivable that a business is unable to collect, often written off as a bad debt expense.