Harry Said to Marge, "I Have a Ring Once Owned

question 68

Multiple Choice

Harry said to Marge, "I have a ring once owned by Marilyn Monroe. Would you like to buy it for $500?" Marge pays for the ring, but the next day a friend tells her that Harry had recently purchased the ring at a local store. Marge enjoys wearing the ring and wears it constantly for twelve months. Finally, she goes to Harry and says, "Here is the ring you lied about. Give me my $500." Most likely Marge will:

• A) get her money back since Harry's statement was fraudulent.
• B) not get her money back since she should have investigated the facts about the ring more carefully.
• C) not get her money back since she is a good faith purchaser of merchandise.
• D) not get her money back since she has affirmed the contract by taking an unduly long time to disaffirm.

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Definitions:

Net Sales

The total revenue from sales of goods or services, minus returns, allowances, and discounts.

Operating Expenses

Costs associated with running a business's core operations on a day-to-day basis, excluding the cost of goods sold.

Cost Of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including materials, labor, and overhead expenses.

Horizontal Analysis

A financial analysis technique that compares line items in financial statements over a number of accounting periods.