JKL, Inc.

ISM CORE Question Answer

JKL, Inc. solicits bids for the repair of a boiler used in its shoe factory. Supplier A submits a bid of $7000. The next lowest bid is $8,000, and the remaining bids are between $10,000 and $11,000. JKL awards the contract to Supplier A. However, before beginning repairs, Supplier A realizes it made a mistake and underestimated the repair work. Supplier A refuses to do the work, saying it would lose money. If JKL declines to increase the payment and claims that Supplier A breached the contract, the MOST likely result would be which of the following?

Supplier A will have breached the contract, but only if JKL did not know or have reason to know that Supplier A's low bid was the result of an error.

Supplier A will not have breached the contract, because Supplier A can successfully argue that the contract is voidable.

Supplier A will not have breached the contract because the frustration of purpose doctrine excuses Supplier A's non-performance.

Supplier A will have breached the contract, but only if it is too late for JKL to accept the bid of the second lowest bidder.

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Product: CORE
Update on: Oct 18, 2025
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A supplier of software critical to PQR Inc.

A company's sales have increased from $100 million to $105 million over the past year.

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JKL, Inc.

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