Larson Entered Forrester's Auto Mart to Purchase a Used Car

question 41

Multiple Choice

Larson entered Forrester's Auto Mart to purchase a used car.Larson found a vehicle with a sales price of $11,000.After Forrester ansed all of Larson's questions,Forrester and Larson agreed to a sale.As Larson was leaving to get the money to pay for the car,Forrester told Larson that Robert Redford formerly owned the car.Larson later learned that Robert Redford had never owned the car.If Larson seeks to rescind the deal based on Forrester's statement,Larson will:

• A) win because he relied on the misrepresentation.
• B) win because there was a misrepresentation of a material fact.
• C) lose because he will not be able to prove reliance on the misrepresentation.
• D) lose because Forrester made a unilateral mistake.

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Definitions:

Finished Goods Inventory

Finished goods inventory refers to the stock of completed products that are ready to be sold but have not yet been purchased or shipped to customers.

Conversion Cost

The combined costs of direct labor and manufacturing overhead that are incurred to convert raw materials into finished goods.

Direct Labour Cost

The total cost of wages paid to workers directly involved in manufacturing a product or providing a service.

Manufacturing Overhead

The indirect costs related to manufacturing that are not directly tied to a specific product, such as utilities, rent, and salaries of maintenance staff.