Joe Was an Insurance Broker and One of His Clients,Sam,had

question 60

Essay

Joe was an insurance broker and one of his clients,Sam,had a house that he wanted to insure.As was his normal practice,Joe got into his car and drove past the house to determine if all was as stated by the client.In the process of doing so,he struck a pedestrian crossing the street in a crosswalk,because he was distracted by his examination of the house.The injured pedestrian sued not only Joe,the insurance broker,but the client as well.Explain the likely outcome.

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Definitions:

Actual Production

The real quantity of products manufactured during a specific period, as opposed to planned or projected production.

Material Price Variance

The difference between the actual cost of materials and the standard cost, multiplied by the quantity of materials used.

Standard Unit Price

A predetermined or established cost that represents an expected or typical amount to be charged or incurred per unit of product or service.

Actual Unit Price

The real cost of a single unit of a product or service, as incurred or experienced in a transaction.