Which of the Following Statements Is the Best Description of an 'Unenforceable

question 40

Multiple Choice

Which of the following statements is the best description of an 'unenforceable' contract?

• A)The contract remains valid and binding unless and until it is repudiated by the injured party.
• B)There are no legal rights or obligations from the outset,and the contract cannot be enforced by either party.
• C)While the contract is valid on its face,no legal action can be brought on it.
• D)The purpose of the contract contravenes a statute or the common law.

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Definitions:

Cost of Goods Sold

Direct costs attributable to the production of the goods sold by a company, including materials and labor costs.

Merchandise Inventory

Goods that a retail or wholesale company intends to sell to customers. The inventory account is adjusted based on purchases and sales.

Purchases Returns

Goods returned to the supplier from the buyer due to defects, inaccuracies in orders, or other reasons.

Sales Returns

Transactions where customers return previously purchased merchandise to the seller, resulting in a deduction from gross sales to arrive at net sales.