Frank Is Building a Home for Debby That Under the Original

question 42

Essay

Frank is building a home for Debby that under the original contract is to be completed by December 31^st. Debby found the plans for the home in a publication focusing on unique houses and is excited because it will be the only home of its type in the area. Because he underestimated the time needed for special and unique framing required for Debby's house, Frank tells Debby that he needs to hire additional workers in order to have the home done by that time and that she needs to pay him an extra $10,000. Debby says that she will pay. Frank finishes the home and asks for his $10,000. Debby refuses to pay. What is the likely result if Frank sues? Discuss whether you believe the result is ethical and equitable.

---

Definitions:

Incremental Sales

The additional sales generated by a new marketing strategy, product launch, or any other business initiative.

Operating Expenses

Expenses that a business incurs through its normal business operations, such as sales and marketing, research, and development costs.

Capital Budgeting

The process of evaluating and selecting long-term investments that are in line with the corporation's goal of wealth maximization.

Straight-Line Depreciation

A method of allocating the cost of a tangible asset over its useful life in a uniform manner.