Alan Sells Merchandise on Credit to ABC Co

question 7

Multiple Choice

Alan sells merchandise on credit to ABC Co.ABC fails to pay for the merchandise.Alan later discovers that ABC is not a corporation,but a partnership consisting of Alice,Betty,and Charles.Which legal doctrine might shield Alice,Betty,and Charles from personal liability?

• A)De facto corporation
• B)De jure corporation
• C)Corporation by estoppel
• D)Piercing the corporate veil

---

Definitions:

Creditor

A person to whom a debt or legal obligation is owed and who has the right to enforce payment of that debt or obligation.

Consideration

Something of value (such as money, goods, or services) that is exchanged between parties in a contract, making the agreement legally binding.

Output Contract

An agreement in which a seller agrees to sell all the production to a particular buyer, who agrees to purchase it.

Requirements Contract

A contract in which one party agrees to supply as much of a good or service as the other party needs during a specified period.