Rustic Replicas Is Owned and Operated by a Craftsman Who

question 40

Multiple Choice

Rustic Replicas is owned and operated by a craftsman who makes replicas of historic firearms for museums,sportsmen,and collectors.He is currently producing 43 flintlock muskets per month.The cost data for the muskets are as follows:

If Rustic expects to sell 40 units per month,what is his margin of safety expressed in units per month?

• A)10 units
• B)30 units
• C)16 units
• D)24 units

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Definitions:

Consideration

Something of value exchanged by the parties involved in a contract, making the agreement legally binding.

Accepted Offer

An offer that has been agreed upon by all parties involved, leading to the formation of a contract.

Preexisting Duty

An obligation that a party is already legally bound to fulfill, which cannot serve as consideration for a new contract.

Bilateral Contract

An agreement between two parties where each promises to perform an act in exchange for the other's performance.