Vernon and Josh Are Partners in an Accounting Firm

question 36

Multiple Choice

Vernon and Josh are partners in an accounting firm.They agree that only Josh has authority to make contracts to perform audits of clients,an agreement known by Mantron Company.Nonetheless,Vernon and Mantron contract for the partnership to audit Mantron's financial statements.Vernon takes the contract to Josh,who reads it and says,"OK,we can perform the audit." In this situation,Josh has _____ the contract.

• A) nullified
• B) modified
• C) ratified
• D) transferred

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Definitions:

Investing Activities

Investing activities are financial transactions related to the acquisition or sale of long-term assets or investments not related to the core business operations.

Financing Activities

Transactions and events affecting the equity and debt of the company, usually related to borrowing, repaying, and issuing equity.

Noncash Investing

Investment activities that do not involve the immediate outlay of cash, such as the exchange of one asset for another.

Financing Activities

Transactions and events that affect the long-term liabilities and equity of a company, including issuing shares, borrowing money, and repaying debt.