Case Brief 3

question 33

Multiple Choice

Case Brief 3.2 discusses the Supreme Court of Canada's decision in Non-Marine Underwriters,Lloyds of London v.Scalera.As a result of that decision

• A)the plaintiff in the case was more likely to receive compensation.
• B)liability insurance is never available if a tort is committed against a child.
• C)liability insurance always defeats tort law's deterrence function.
• D)sexual abuse may involve a crime,but it never creates liability in tort.
• E)an insurance company may,depending upon the wording of a liability insurance policy,exclude coverage if the insured party intentionally committed a tort.

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Definitions:

Variable Costing

A costing method that includes only the variable manufacturing costs (direct materials, direct labor, and variable manufacturing overhead) in product costs.

Unit Product Cost

The total cost (both variable and fixed) to produce a single unit of product.

Contribution Format

A type of income statement that separates variable costs from fixed costs to calculate a company's contribution margin.

Absorption Costing

A costing method that includes all manufacturing costs—direct materials, direct labor, and both variable and fixed manufacturing overhead—in the cost of a product.