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Bonnie needs to buy a lawn mower. Her lawn is relatively modest, so she began looking for an affordable model. Her friend, Keven, also needed a lawn mower. His yard was much larger, so he went to Bonnie and said, “Bonnie, we both need a lawn mower. Why don’t we go shopping and get the lawn mower together?” Bonnie and Kevin found a suitable lawn mower for $5,000. Bonnie talked to the salesmen and the salesmen agreed to extend Bonnie a loan to purchase the lawn mower if Kevin would orally contract to stand as a surety for Bonnie if the payments were not made on time. For two months, Kevin uses the lawn mower more than anyone. But then Bonnie fails to make payments and the salesman sues Kevin under the oral contract since he agreed to guarantee the payments. Is Kevin responsible to the salesman for the purchase? Why or why not? Is Bonnie responsible to either the salesman or Kevin for the purchase? Why or why not?

Operation Management, Management Studies

  • Category:- Operation Management
  • Reference No.:- M93108081

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