Which of the following is correct with regard to consideration?
a. In a unilateral contract, a promise is exchanged for an act or forbearance to act.
b. In a bilateral contract, there is an exchange of promises.
c. Legal sufficiency is always related to adequacy of consideration.
d. Two of these are correct.
d
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Crush Enterprises purchased 500,000 of the 1,000,000 outstanding shares of Carly Casualties for $4,500,000 on 1/1/16. On the date of the investment, Carly had net assets with a book value of $9,500,000 and fair value of $10,000,000. This difference is the result of equipment (remaining 10 year life) with a higher fair value than book value. Crush has significant influence over Carly and will
account for this investment using the equity method. During the year, Carly declared dividends of $125,000 and reported Net Income of $1,300,000. Prepare all necessary journal entries for Crush related to this investment. Then, calculate the ending balance in the Investment in Carly account. What will be an ideal response?
Two black professors and their families (who had recently transferred to a university in a small town) sought to purchase homes in an all?white development. The developer took the professors aside and told them that he would build them the same homes for cost anywhere else in the town if they would not buy in the subdivision. The professors wish to file suit. Do they have any rights?