The Sports Barn Sells Football Helmets for PeeWee Football,and a Customer

question 107

Multiple Choice

The Sports Barn sells football helmets for PeeWee football,and a customer buys one for his son.The helmet cracks in several places as the son makes a tackle during a game later that fall,leaving the boy seriously injured.The _____ makes the retailer potentially liable.

• A) implied warranty of correctness
• B) Clayton Act
• C) expressed warranty of merchantability
• D) Robinson-Patman Act
• E) implied warranty of merchantability

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Definitions:

Direct Materials Purchased

The raw materials bought by a company that are directly used in the production of its goods.

Actual Variable Manuf. Overhead

The real costs incurred from indirect, variable production expenses, assessed after the production process is completed.

Variable Manufacturing Overhead

These are manufacturing overhead costs that vary with the level of production output, such as utilities or materials used in the manufacturing process.

Materials Price Variance

The difference between the actual cost of materials used in production and the expected cost based on standard prices.