The Parol Evidence Rule Does Not Apply To

question 50

Multiple Choice

The parol evidence rule does not apply to:

• A) a typographical error that obviously does not represent the agreement of the parties.
• B) evidence showing one of the parties to the contract lacks contractual capacity.
• C) The parol evidence rule does not apply to the evidence in either of these situations.
• D) The parol evidence rule applies to the evidence in both of these situations.

---

Definitions:

Predetermined Overhead Rate

A rate calculated before a period begins, used to allocate manufacturing overhead costs to products based on a selected activity base such as labor hours or machine hours.

Direct Labor-Hours

The total hours of labor directly involved in manufacturing a product, used in calculating labor costs and efficiency in production.

Job-Order Costing

A system that assigns manufacturing costs to each product, providing a way to calculate the cost per item or job specifically.

Predetermined Overhead Rate

An estimated rate used to allocate manufacturing overhead costs to products or job orders, based on a planned amount of activity.