Examine the financial statements, Financial Accounting

Assignment Help:

Your firm has been hired to examine the financial statements of Bonanza Development Corp. for possible irregularities.  As part of this task, you reviewed certain land transactions involving John Walters, who worked as an agent for Bonanza.  Bonanza feared the price of land would skyrocket if it became known that it was trying to purchase a large number of tracts of land to develop a shopping center near Flats, Nebraska.  It, therefore, instructed Walters not to disclose to prospective sellers that he was acting as an agent on its behalf.  None of the sellers asked Walters if he was an agent for anyone.  The agreement between Walters and Bonanza was in writing and signed by both parties.

Based on the above facts, answer the following questions as (1-6) True or False.

1.  Bonanza is an unidentified principal.

2.  Walters is personally liable on the contracts he enters into on behalf of Bonanza.

3.  Bonanza cannot enforce the contracts made by Walters secretly on its behalf.

4.  The sellers who entered into contracts with Walters can enforce the contracts against Walters, but not Bonanza.

5.  Walters had actual authority to enter into the contracts with the sellers.

6. Walters is not an agent of Bonanza since the prospective sellers did not know he was working for Bonanza.


Related Discussions:- Examine the financial statements

What do you understand by exempt organization, Q. What do you understand by...

Q. What do you understand by Exempt Organization? Exempt Organization - Organization that is normally exempt from paying federal income tax. Exempt organizations comprise relig

What is goodwill, Find the heading Goodwill. What type of an asset is goodw...

Find the heading Goodwill. What type of an asset is goodwill? Does Amazon write off this asset? Explain what the company does

Amortized payment, Amortized Payment You purchase a house that costs $...

Amortized Payment You purchase a house that costs $800,000 with an 8%, 30-year mortgage. You make a 20% down payment to avoid PMI insurance. (i) What is your monthly paymen

Estimate parametric market var, You have an investment in a portfolio with ...

You have an investment in a portfolio with a counterparty whose current credit rating is Baa. The current market value of the portfolio is $50,000,000 and its annual volatility is

Financial institution, Financial Institution - Organization engaged in any ...

Financial Institution - Organization engaged in any of the many aspects of finance involving thrift institutions, commercial banks, securities brokers, investment banks and dealers

What do you mean by re - organization, Q. What do you mean by Re - organiza...

Q. What do you mean by Re - organization? Reorganization - This is a change in businesses capital arrangements. If for a CORPORATION there are 7 statutory options for reorganiz

Heath foods''s bonds , Heath Foods's bonds have 6 years left over to maturi...

Heath Foods's bonds have 6 years left over to maturity. The bonds have a face value of $1,000 and a yield to maturity of 8%. They pay interest yearly and have a 10% coupon rate. Wh

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd