A Contract in Which a Party Assumes a Primary Obligation

question 51

True/False

A contract in which a party assumes a primary obligation must be in writing to be enforceable.

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Definitions:

Operating Income

Earnings before interest and taxes (EBIT), representing the profit a company makes from its core operations.

Capacity

The maximum amount of work that an organization is capable of completing in a given period of time.

Variable Costing

A costing method that includes only variable manufacturing costs—direct materials, direct labor, and variable manufacturing overhead—in unit product costs.

Unsold Units

Inventory items that have been produced or acquired but have not yet been sold to customers.