An Agreement Between a Buyer and Seller to Commit a Transaction

question 11

Multiple Choice

An agreement between a buyer and seller to commit a transaction in a future date at a price negotiated today is a(n) _________ contract.

• A) Open
• B) Forward
• C) Long
• D) Option
• E) Exchange

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Definitions:

Overhead

The ongoing administrative and general expenses of a business that are not directly attributable to specific products or services.

Standard Labor Hours

The estimated amount of time that should be required to produce a unit of product or to complete a process, task, or project.

Direct Labor Rate Variance

A measure of the difference between the actual cost of direct labor and the expected (or standard) cost.

Standard Rate

A predetermined cost or charge that applies to a particular activity, operation, or product within a business environment.