Which of the Following Is True Regarding Respondeat Superior

question 21

Multiple Choice

Which of the following is true regarding respondeat superior?

• A) Under that theory, a principal may be liable for not only the contracts but also the torts of its agents.
• B) Under that theory, a principal may be liable for only the contracts of its agents, not the torts.
• C) Under that theory, a principal may be liable for only the torts of its agents, not the contracts.
• D) Under that theory, a principal may not be held liable for either the contracts or torts of its agent unless the principal expressly authorize the agent's actions.

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Definitions:

Fixed Manufacturing Overhead

Consists of manufacturing costs that do not change with the level of production, such as salaries of supervisors and rent for factory premises.

Denominator Level

The level of activity used to compute the fixed manufacturing overhead rate in absorption costing, affecting inventory and cost of goods sold.

Budget Variance

The difference between budgeted amounts and actual amounts spent or received.

Volume Variance

The difference between the expected volume of production or sales and the actual volume, affecting budgeting and costing.