A Lockbox Plan Is Most Beneficial to Firms That

question 173

Multiple Choice

A lockbox plan is most beneficial to firms that

• A) Send payables over a wide geographic area.
• B) Have widely disbursed manufacturing facilities.
• C) Have a large marketable securities account to protect.
• D) Hold inventories at many different sites.
• E) Make collections over a wide geographic area.

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Definitions:

Material Breach

A significant failure to perform under a contract which permits the other party to either demand performance or terminate the agreement.

Frustration of Purpose

A doctrine in contract law that can discharge the parties' obligations when a change in circumstances makes the contract impossible to perform as originally intended.

Prevention of Performance

Prevention of performance is a situation where one party's actions make it impossible for the other party to fulfill their contractual obligations, potentially leading to legal consequences.

American History

The recorded events, actions, and developments that have occurred in the United States from its founding to the present day.