Mini-Case Brian and Sondra Have Just Opened a New Cajun Restaurant

question 90

Multiple Choice

Mini-Case
Brian and Sondra have just opened a new Cajun restaurant on the edge of town, Cajun Cookin' Inc. They own the land and building and have a brand-new kitchen as well as a lovely seating area, filled with mementos from the South. They have a liquor license and make wonderful Southern drinks. They are quite pleased that members of the community are helping their business grow by coming in for a meal or a drink after work. They are good businesspeople who pay their bills on time and as a result have great relationships with the vendors that supply them food.
-As it turns out, Brian and Sondra's good fortune with the restaurant has caused their competitors to lose business. In fact, Cajun Cookin' has been so successful that two other nearby restaurants are in danger of going out of business. Brian and Sondra have:

• A) engaged in anti-competitive behavior.
• B) violated the Sherman Antitrust Act.
• C) engaged in price discrimination.
• D) done nothing against the law.

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Definitions:

Process Costing System

An accounting method used to allocate costs to units of product in continuous processes or industries where the products are indistinguishable from each other.

Equivalent Unit

A measure used in cost accounting to represent the amount of work done on partial units of production, making them comparable to fully completed units.

Cost Reconciliation Report

A report that reconciles the total costs incurred with the costs accounted for in a specific period, used in cost accounting to ensure accuracy.

Work In Process Inventory

Inventory category in manufacturing representing goods that have been started but not yet completed, highlighting a transition state in production.