The Principle of Substantial Performance Can Best Be Described as Which

question 80

Multiple Choice

The principle of substantial performance can best be described as which of the following?

• A) All or most of contractual obligations are fulfilled.
• B) A major term of the contract is mostly fulfilled.
• C) Minor terms of the contract are yet to be fulfilled.
• D) Minor terms of the contract are disregarded.
• E) Only exact compliance with the contract will qualify as performance.

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Definitions:

Direct Method

A cost allocation approach directly assigning service department costs to producing departments without any intermediate steps.

Sales Adjusted

The revision of sales figures to account for returns, allowances for damaged goods, and discounts given.

Cash Basis

An accounting method where transactions are recorded when cash is received or paid, without regard to when the transactions occurred.

Selling and Administrative Expense

Costs incurred by a company from its selling activities and the management of the overall company, excluding production costs.