Fact Pattern 37-2A (Questions A9-A10 Apply)

question 39

Multiple Choice

Fact Pattern 37-2A (Questions A9-A10 apply)
Luann and Mace are partners in Networx,a computer peripherals firm.
-Refer to Fact Pattern 37-2A.Luann signs a contract with Oleo Chips,a retail component supplier,apparently on Networx's behalf.The contract is binding on

• A)Luann,Mace,and Networx.
• B)Luann only.
• C)Networx only.
• D)Oleo only.

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Definitions:

Payments

Transactions or transfers of money from one party to another, typically in exchange for goods, services, or to fulfill a financial obligation.

Costs

The expenditure of resources, such as time, labor, and materials, required to achieve an objective or the production of goods and services.

Profits

Profits are the financial gains obtained when the revenues generated from business activities exceed the expenses, costs, and taxes needed to sustain the operation.

Entrepreneurial Ability

The skill or talent for identifying new business opportunities and the willingness to take risks to develop and manage a business.