Manuel and Janice Enter into an Oral Contract Which States

question 71

Essay

Manuel and Janice enter into an oral contract which states that Janice will sell her house to Manuel.Manuel makes a partial payment to Janice as per the contract.When Janice vacates the house,Manuel hires a contractor to build a fence around the backyard to ensure security.However,Janice revokes her offer saying that a third party is paying a higher price for the house,and her offer to Manuel was not in written form.Manuel,who has spent $5,000 on the fencing,decides to sue Janice.Analyze the case.

Differentiate between changes in demand and changes in quantity demanded

Identify the impact of income changes on demand

Recognize the effects of complementary and substitute goods on demand

Determine how changes in price affect quantity demanded

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Definitions:

Variable Costs

Costs that change in proportion to the level of goods or services produced by a business.

Total Manufacturing Costs

The aggregate of all costs involved in the process of producing a product, including direct materials, direct labor, and manufacturing overhead.

Business Unit Reporting

The process of preparing and presenting financial and operational reports specific to distinct divisions or segments of a company.

Absorption-Costing Format

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