Shelby Wants to Sell His Bobcat Skidsteer for $21,000

question 72

Multiple Choice

Shelby wants to sell his Bobcat Skidsteer for $21,000. He e-mails Dave and offers to sell Dave the Bobcat. Due to a typo,Shelby tells Dave that he wants $20,100 for the Bobcat. Dave accepts the offer and pays Shelby $20,100. Shelby is

• A)not bound by the contract due to a unilateral mistake.
• B)not bound by the contract due to a bilateral mistake.
• C)not bound by the contract due to a mistake of value.
• D)bound by the contract.

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Definitions:

Total Cost Approach

A cost management strategy that considers all possible costs associated with a product or service, aiming for a comprehensive analysis.

Discount Factor(s)

Factors used in financial calculations to determine the present value of future payments or cash flows.

Discount Rate

For the purpose of discounted cash flow analysis, this rate of interest is key in determining the existing value of forthcoming cash flows.

Operating Costs

Expenses related to the day-to-day functions of a business, excluding direct materials and direct labor costs.