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Questions & Answers.pdf!!!Financial Chapter 14_ Questions & Answers.pdfFinancial Chapter 14
Financial Chapter 14: Questions & Answers
1 English legal system
Question 1
Describe the first instance jurisdiction of the civil courts and explain the system of appeals in
civil cases.
(10 marks)
Question 2
Explain the rules and presumptions used by the courts in interpreting statutes.
(10 marks)
2 Contract law
Question 3
In relation to contract law distinguish between offers andinvitations to treat and explain why it
is important to make such adistinction.
(Adapted from ACCA June 2004)
(10 marks)
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Questions & Answers.pdf!!!Financial Chapter 14_ Questions & Answers.pdfFinancial Chapter 14
Question 4
Hilary advertised a printing press in a specialist trade journalfor £15,000. Eleanor wrote to
Hilary offering to buy it for £10,000.Hilary replied by return of post saying she would accept
£13,000. Whenshe heard nothing further from Eleanor, Hilary wrote again saying shewould
accept £10,000.
Hilary wrote to Amy offering for sale an office computer for£1,000. The morning that she
received the letter Amy wrote to Hilaryagreeing to buy at the asking price. After she had
posted the letter,but before it was delivered, Amy changed her mind and sent Hilary a
faxasking her to ignore the letter when it arrived.
Required:
Advise Hilary as to whether binding contracts exist between herself and:
AEleanor
BAmy.
(Adapted from ACCA June 1997)
(10 marks)
Question 5
Explain the meaning of the following:
Athe principle that consideration must be sufficient but need not be adequate
Bthe principle that consideration may be executed or executory, but must not be past.
(10 marks)
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Questions & Answers.pdf!!!Financial Chapter 14_ Questions & Answers.pdfFinancial Chapter 14
Question 6
Raymond runs a small consultancy business, of which he is the soleproprietor, specialising in
personal taxation advice. He entered into acontract with Samantha, a struggling artist, under
which he agreed toprepare some draft business accounts for her, covering the last
threeyears, for the sum of £800. Raymond completed the work but Samanthatold him she
could only afford to pay £200 for the work. After a bitterargument Raymond reluctantly
accepted a cheque for £200 from Samantha,which was stated to be in full and final
settlement of the debt.
Shortly afterwards Samantha's paintings began to realise very highprices and Raymond has
just read in a newspaper that her latest work hasbeen sold for £20,000. He now wishes to
claim the balance of £600from Samantha and approaches you for advice.
Advise Raymond.
(Adapted from ACCA June 1996)
(10 marks)
Question 7
Grace, an accountant, works as a sole practitioner. She does notemploy any staff. Grace has
recently won a lucrative contract fromExpansion Ltd to undertake all the company's payroll
work. The initialperiod is for six months, renewable thereafter on a 12-monthly basis aslong
as the work done by Grace is satisfactory.
In order to undertake the work for Expansion Ltd, Grace hires apowerful desktop computer
together with dedicated software from OfficeSupplies Ltd. Grace signed a written hire contract
with Office SuppliesLtd but she did not read it. It contained a clause stating that
'OfficeSupplies Ltd are not liable for any financial losses or other losses,however caused,
occasioned by using hardware or software productssupplied by the company'.
Neither the computer nor the software operated correctly because ofnegligent design and
manufacture by the company and as a result Gracefailed to make proper National Insurance
deductions for the employees ofExpansion Ltd. Expansion Ltd consequently refused to renew
the contractwith Grace and she suffered considerable loss in her profits as aresult.
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ns & Answers.pdf!!!!!!!!!!!!!!!!!!!!!!!!()@@@@@@@@@@@@@###########******************$&%^^^^^^^^^^^^^^^^^^^&*#(@(#(!#(!
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Office Supplies Ltd admits that it has been negligent but deniesany liability to Grace on the
basis of the exclusion clause in thecontract.
Advise Grace.
(Adapted from ACCA Dec 1994)
(10 marks)
Question 8 - Fixed Test 1
Describe briefly the main rules that govern:
Athe incorporation of exemption clauses into contracts
Bthe interpretation of exemption clauses in contracts.
(10 marks)
Question 9
State and explain the remedies available for breach of contract.
(Adapted from ACCA Dec 2004)
(10 marks)
3 The law of torts
Question 10
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& Answers.pdf!!!!!!!!!!!!!!!!!!!!!!!!()@@@@@@@@@@@@@###########******************$&%^^^
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ns & Answers.pdf!!!!!!!!!!!!!!!!!!!!!!!!()@@@@@@@@@@@@@###########******************$&%^^^^^^^^^^^^^^^^^^^&*#(@(#(!#(!
Financial Chapter 14_ Chapter
Questions14_
& Answers.pdf!!!!!!!!!!!!!!!!!!!!!!!!()@@@@@@@@@@@@@###########******************$&%^^^
Questions & Answers.pdf!!!Financial Chapter 14_ Questions & Answers.pdfFinancial Chapter 14
Financial Chapter 14: Questions & Answers
1 English legal system
Question 1
Describe the first instance jurisdiction of the civil courts and explain the system of appeals in
civil cases.
(10 marks)
Question 2
Explain the rules and presumptions used by the courts in interpreting statutes.
(10 marks)
2 Contract law
Question 3
In relation to contract law distinguish between offers andinvitations to treat and explain why it
is important to make such adistinction.
(Adapted from ACCA June 2004)
(10 marks)
^^^^^^^&*#(@(#(!#(!Financial
ns & Answers.pdf!!!!!!!!!!!!!!!!!!!!!!!!()@@@@@@@@@@@@@###########******************$&%^^^^^^^^^^^^^^^^^^^&*#(@(#(!#(!
Financial Chapter 14_ Chapter
Questions14_
& Answers.pdf!!!!!!!!!!!!!!!!!!!!!!!!()@@@@@@@@@@@@@###########******************$&%^^^
Questions & Answers.pdf!!!Financial Chapter 14_ Questions & Answers.pdfFinancial Chapter 14
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Financial Chapter 14_ Chapter
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& Answers.pdf!!!!!!!!!!!!!!!!!!!!!!!!()@@@@@@@@@@@@@###########******************$&%^^^
Questions & Answers.pdf!!!Financial Chapter 14_ Questions & Answers.pdfFinancial Chapter 14
Question 4
Hilary advertised a printing press in a specialist trade journalfor £15,000. Eleanor wrote to
Hilary offering to buy it for £10,000.Hilary replied by return of post saying she would accept
£13,000. Whenshe heard nothing further from Eleanor, Hilary wrote again saying shewould
accept £10,000.
Hilary wrote to Amy offering for sale an office computer for£1,000. The morning that she
received the letter Amy wrote to Hilaryagreeing to buy at the asking price. After she had
posted the letter,but before it was delivered, Amy changed her mind and sent Hilary a
faxasking her to ignore the letter when it arrived.
Required:
Advise Hilary as to whether binding contracts exist between herself and:
AEleanor
BAmy.
(Adapted from ACCA June 1997)
(10 marks)
Question 5
Explain the meaning of the following:
Athe principle that consideration must be sufficient but need not be adequate
Bthe principle that consideration may be executed or executory, but must not be past.
(10 marks)
^^^^^^^&*#(@(#(!#(!Financial
ns & Answers.pdf!!!!!!!!!!!!!!!!!!!!!!!!()@@@@@@@@@@@@@###########******************$&%^^^^^^^^^^^^^^^^^^^&*#(@(#(!#(!
Financial Chapter 14_ Chapter
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& Answers.pdf!!!!!!!!!!!!!!!!!!!!!!!!()@@@@@@@@@@@@@###########******************$&%^^^
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& Answers.pdf!!!!!!!!!!!!!!!!!!!!!!!!()@@@@@@@@@@@@@###########******************$&%^^^
Questions & Answers.pdf!!!Financial Chapter 14_ Questions & Answers.pdfFinancial Chapter 14
Question 6
Raymond runs a small consultancy business, of which he is the soleproprietor, specialising in
personal taxation advice. He entered into acontract with Samantha, a struggling artist, under
which he agreed toprepare some draft business accounts for her, covering the last
threeyears, for the sum of £800. Raymond completed the work but Samanthatold him she
could only afford to pay £200 for the work. After a bitterargument Raymond reluctantly
accepted a cheque for £200 from Samantha,which was stated to be in full and final
settlement of the debt.
Shortly afterwards Samantha's paintings began to realise very highprices and Raymond has
just read in a newspaper that her latest work hasbeen sold for £20,000. He now wishes to
claim the balance of £600from Samantha and approaches you for advice.
Advise Raymond.
(Adapted from ACCA June 1996)
(10 marks)
Question 7
Grace, an accountant, works as a sole practitioner. She does notemploy any staff. Grace has
recently won a lucrative contract fromExpansion Ltd to undertake all the company's payroll
work. The initialperiod is for six months, renewable thereafter on a 12-monthly basis aslong
as the work done by Grace is satisfactory.
In order to undertake the work for Expansion Ltd, Grace hires apowerful desktop computer
together with dedicated software from OfficeSupplies Ltd. Grace signed a written hire contract
with Office SuppliesLtd but she did not read it. It contained a clause stating that
'OfficeSupplies Ltd are not liable for any financial losses or other losses,however caused,
occasioned by using hardware or software productssupplied by the company'.
Neither the computer nor the software operated correctly because ofnegligent design and
manufacture by the company and as a result Gracefailed to make proper National Insurance
deductions for the employees ofExpansion Ltd. Expansion Ltd consequently refused to renew
the contractwith Grace and she suffered considerable loss in her profits as aresult.
^^^^^^^&*#(@(#(!#(!Financial
ns & Answers.pdf!!!!!!!!!!!!!!!!!!!!!!!!()@@@@@@@@@@@@@###########******************$&%^^^^^^^^^^^^^^^^^^^&*#(@(#(!#(!
Financial Chapter 14_ Chapter
Questions14_
& Answers.pdf!!!!!!!!!!!!!!!!!!!!!!!!()@@@@@@@@@@@@@###########******************$&%^^^
Questions & Answers.pdf!!!Financial Chapter 14_ Questions & Answers.pdfFinancial Chapter 14
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ns & Answers.pdf!!!!!!!!!!!!!!!!!!!!!!!!()@@@@@@@@@@@@@###########******************$&%^^^^^^^^^^^^^^^^^^^&*#(@(#(!#(!
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Questions14_
& Answers.pdf!!!!!!!!!!!!!!!!!!!!!!!!()@@@@@@@@@@@@@###########******************$&%^^^
Questions & Answers.pdf!!!Financial Chapter 14_ Questions & Answers.pdfFinancial Chapter 14
Office Supplies Ltd admits that it has been negligent but deniesany liability to Grace on the
basis of the exclusion clause in thecontract.
Advise Grace.
(Adapted from ACCA Dec 1994)
(10 marks)
Question 8 - Fixed Test 1
Describe briefly the main rules that govern:
Athe incorporation of exemption clauses into contracts
Bthe interpretation of exemption clauses in contracts.
(10 marks)
Question 9
State and explain the remedies available for breach of contract.
(Adapted from ACCA Dec 2004)
(10 marks)
3 The law of torts
Question 10
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Questions & Answers.pdf!!!Financial Chapter 14_ Questions & Answers.pdfFinancial Chapter 14
