Julia Owes Ryan $10,000

question 58

Multiple Choice

Julia owes Ryan $10,000.When the debt comes due,Julia refuses to pay.Ryan obtains a judgment against Julia to collect the debt,but she still refuses to pay.Using a writ of execution,the court orders the sheriff to seize Julia's boat and sell it to pay the debt.The boat sells for $15,000.Ryan will receive 

• A) ​$15,000 and Julia will receive nothing. 
• B) ​$10,000 and Julia will receive $5,000. 
• C) ​$7,500 and Julia will receive $7,500. 
• D) ​$10,000 and the court will receive $5,000.

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Definitions:

Contribution Margin

The amount by which sales revenue exceeds variable costs of production, indicating how much contributes to covering fixed costs and generating profit.

Operating Income

A measure of a company's profitability from its regular business operations, excluding income and expenses from unusual or non-operational activities.

Absorption Costing

An accounting method that includes all manufacturing costs (both fixed and variable) in the cost of a product.

Operating Income

Earnings from a company's core business operations, excluding expenses and revenues from investments and other non-operational activities.