For Ratification to Be Effective

question 6

Multiple Choice

For ratification to be effective:

• A)the principal cannot be disclosed to the third person.
• B)the agent or purported agent must have acted on behalf of the principal.
• C)the principal must have had capacity to do the act only at the time of ratification.
• D)it is necessary that the principal fully understand the legal significance of all material facts.

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Definitions:

Cash Account

A financial account that tracks the flow of cash transactions, including receipts and payments, within a company.

Sales Discounts

Reductions in the sale price offered by a seller as an incentive for prompt payment by the buyer.

Cash Collection

The process of gathering and processing payments received from customers or clients.

Credit Terms

The conditions under which credit will be extended to a borrower, including repayment schedule, interest rate, and the lifespan of the loan.