ACCT352 Study Guide - Final Guide: Division Of Property, Community Property, Common-Law Marriage
16 Dec 2016
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Principal-agent relationship (agency): fiduciary relationship formed when employer hires employee and gives them authority to act on his or her behalf and enter into contracts with third parties. Fiduciary relationship: strictest duty of care recognized by the us legal system, legal duty to act solely in principal"s interest everywhere at once. Principals lack expertise in certain fields and cannot be. Principal: party who employs someone to act on his/her behalf. Principal-independent contractor relationship: independent contractor is not an employee of the principal but has been hired to perform a certain task. Express agency: when principal and agent expressly agree to enter into agency agreement, bound by contract. Implied agency: bound by contract, authority consists of powers incidental & necessary for express authority. Agency by ratification: when a person misrepresents him or herself as an agent, but the principal ratifies the act or contract.
