Price Reduction Is Not Available as a Buyer's Remedy for the Seller's

question 57

Multiple Choice

Price reduction is not available as a buyer's remedy for the seller's breach under the CISG if:

• A) the seller has already delivered conforming substitute goods.
• B) the buyer has refused to accept the seller's attempt to cure the breach.
• C) the buyer has avoided the contract and refused delivery.
• D) all of these are correct.

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Definitions:

Direct Materials

Raw materials that are directly traceable to the production of specific goods or services and are significant in terms of cost.

Manufacturing Overhead

Refers to all the indirect costs associated with manufacturing, not directly tied to a specific product, such as factory rent or maintenance.

Predetermined Overhead Rate

A rate used to allocate manufacturing overhead to individual products or job orders, calculated before the period begins based on estimated costs and activity levels.

Manufacturing Overhead

Indirect costs related to the production process, such as factory rent, utilities, and maintenance, which are not directly tied to specific units produced.