Question

Simmons, an agent for Jensen, has the express authority to sell Jensen's goods. Simmons also has the express authority to grant discounts of up to 5% of list price. Simmons sold Temple goods with a list price of $1,000 and granted Temple a 10% discount. Temple had not previously dealt with either Simmons or Jensen. Which of courses of action may Jensen properly take?

Answer 1

In this scenario, Simmons, the agent for Jensen, has express authority to sell Jensen's goods and grant discounts of up to 5% of the list price. However, Simmons granted a 10% discount to Temple, which exceeds the authorized limit. Temple had not previously dealt with either Simmons or Jensen.

Step-by-step explanation:

Jensen may take the following courses of action:

Accept the Sale: Jensen may choose to accept the sale and honor the 10% discount granted by Simmons, even though it exceeds the authorized limit. This is a business decision that considers customer satisfaction and maintaining a good relationship with Temple.

Reject the Sale: Jensen may choose to reject the sale and refuse to honor the 10% discount. In this case, Temple would have the option to accept the goods at the original list price or choose not to proceed with the purchase.

Take Disciplinary Action Against Simmons: Jensen may take internal disciplinary action against Simmons for exceeding the authorized discount limit. This could include reprimands, training, or other appropriate measures.