An agreement between two parties to pay a lesser amount to settle an unliquidated debt is
A. enforceable, as there is consideration.
B. unenforceable, as there is no consideration.
C. enforceable in only some states.
D. unenforceable as a violation of public policy.
Answer: A
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Cash equivalents do not include
A) U.S. Treasury bills. B) money market accounts. C) marketable securities. D) commercial paper.
Foreign currency translation adjustments arising from translation of the financial statements of a foreign subsidiary are reported in
a. stockholders' equity of the foreign subsidiary. b. revenue or expenses of the foreign subsidiary. c. consolidated net income of the parent company and the foreign subsidiary. d. stockholders' equity of the parent company.
The “economic man” argument suggests that:
A) People consider all available alternatives and then make choices that maximize the values they receive B) People pick the cheapest options wherever available C) People pick the most expensive option provided it offers added value D) People rarely consider the benefits of picking a more expensive option before selecting the most economic one
A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. On July 7, it returned $200 worth of merchandise. On July 28, it paid the full amount due. Assuming the company uses a perpetual inventory system, and records purchases using the gross method, The correct journal entry to record the purchase on July 5 is:
A. Debit Accounts Payable $1,800; credit Purchase Returns $200; credit Merchandise Inventory $1,600. B. Debit Accounts Payable $1,800; credit Merchandise Inventory $1,800. C. Debit Merchandise Inventory $1,800; credit Accounts Payable $1,800. D. Debit Merchandise Inventory $1,800; credit Sales Returns $200; credit Cash $1,600. E. Debit Merchandise Inventory $1,600; credit Cash $1,600.