Why Can an Agent Generally Not Take an Opportunity Meant

question 46

Essay

Why can an agent generally not take an opportunity meant for the principal? Is an agent ever permitted to take such an opportunity? Give an example of an agent's violation of the duty of loyalty.

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Definitions:

Cost of Goods Sold

The total cost directly associated with producing or purchasing the goods sold by a business during a specific period, including materials and labor.

Selling Expense

Expenses directly related to the selling of products or services, such as advertising, sales commissions, and retail store expenses.

Inventory Shrinkage

The loss of products between purchase and sale, typically due to theft, damage, or errors in counting.

Physical Count

Physical count involves the manual counting and verification of the quantities of inventory or stock a business holds at a specific point in time.