The Amount of Liquidated Damages Included in a Contract That

question 87

Multiple Choice

The amount of liquidated damages included in a contract that would be upheld by a court:

• A)must be reasonable in light of the inconveniences or lack of feasibility of obtaining an adequate remedy.
• B)may be so high as to be punitive to the breaching party.
• C)may be regarded as a penalty.
• D)All of the above.
• E)None of the above.

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Definitions:

Net Income

The total profit of a company after all expenses, including taxes and costs, have been deducted from total revenue.

Dividends

Payments made by a corporation to its shareholders, usually as a distribution of profits.

Premium on Bonds Payable

The amount by which a bond's selling price exceeds its face value.

Interest Expense

The cost incurred by an entity for borrowed funds over a period, which can include payments on debts, loans, or credit lines.