With a Simple Delivery Contract Involving Goods Sold by a Merchant

question 67

Multiple Choice

With a simple delivery contract involving goods sold by a merchant that are to be delivered to the buyer,when does risk of loss transfer to the buyer?

• A)When money is transferred from the buyer to the seller
• B)When the items are tendered to the buyer
• C)When the goods are delivered to the buyer
• D)Three days (seventy-two hours)after the goods are identified to the contract
• E)When the goods are identified to the contract

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Definitions:

Machine-Hours

A unit of measure representing the operation of one machine for one hour, used in allocating manufacturing costs.

Predetermined Overhead Rate

It's a rate used to allocate manufacturing overhead based on a particular activity (like labor hours or machine hours).

Manufacturing Overhead

Indirect costs associated with manufacturing, including expenses related to operating the factory like utilities, depreciation, and maintenance.

Machine-Hours

A metric indicating the cumulative operational duration of machinery within a specified time frame, often utilized in calculating overhead rates.