If a Buyer Becomes Concerned That the Seller May Not

question 50

Multiple Choice

If a buyer becomes concerned that the seller may not be able to perform required contract obligations,the buyer:

• A) can legally make the contract without telling the other party.
• B) can demand assurance from the seller that the contract will be performed.
• C) will be excused from fair trade under the test of commercial impracticability.
• D) will be excused from performance under the test of impossibility.

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Definitions:

Accounting Equation

The fundamental equation underpinning the double-entry bookkeeping system: Assets = Liabilities + Equity.

Liabilities

The financial liabilities a firm has towards other parties, necessitating reimbursement through the provision of economic gains over a specified duration.

Increase Assets

An action or transaction that results in a rise in the total value of assets owned by an individual or entity.

Decrease Assets

Decrease in assets refers to a reduction in the economic resources controlled by a company, which can result from expenses, asset disposals, or liabilities being paid off.