In What Form Should a Contract Be in Order to Be

question 9

Multiple Choice

In what form should a contract be in order to be a legal contract?

• A) oral agreement only
• B) oral agreement by only two individuals
• C) oral or written agreement
• D) written agreement only

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Definitions:

Liabilities

Financial obligations or debts owed by a company to external parties or creditors that must be settled over time through the transfer of economic benefits.

Stockholders' Equity

The ownership interest of stockholders in the assets of a corporation, calculated as total assets minus total liabilities.

Accruals

Accounting adjustments for revenues that have been earned but are not yet recorded in the accounts, and for expenses that have been incurred but are not yet recorded.

Incurred

This term refers to the recognition of costs or expenses in accounting when a company commits to them through its operations, regardless of when payment is made.