OrganicFoods Inc

question 24

Multiple Choice

OrganicFoods Inc.entered into a contractual supply arrangement with EcoGrow Inc.EcoGrow contractually promised to supply two tons of organic carrots by May 1,providing carrots were available.If EcoGrow does not supply the carrots as agreed,how do you think a court would view EcoGrow's obligation to OrganicFoods to do so?

• A) Business efficacy makes the obligation conditional.
• B) Business efficacy makes the obligation provisional.
• C) Business efficacy makes the obligation express.
• D) Business efficacy makes the obligation absolute.

---

Definitions:

Variable Manufacturing Overhead

Costs that vary with production volume, such as utilities and materials, which are only incurred as a result of manufacturing activities.

Direct Materials

Raw materials that are directly traceable to the production of specific goods or services.

Contribution Margin

The amount by which sales revenue exceeds variable costs, contributing to covering fixed costs and generating profit.

Variable Production Costs

Costs that vary directly with the level of production output, such as raw materials and direct labor.