Can Rufus and Sven Move Forward with the Purchase of New

question 76

Multiple Choice

Can Rufus and Sven move forward with the purchase of new equipment from SportsCo,over Igor's insistence on purchasing the equipment from HealthCo?

• A)Yes,because most partnership decisions are made by majority vote and this decision does not involve an alteration in the nature of the business.
• B)No,although most partnership decisions are made by majority vote,this decision involves an alteration in the nature of the business.
• C)No,because decisions that involve an alteration in the nature of the business require a unanimous vote.
• D)Yes,but only if all material facts about the restaurant and casino have been disclosed to Igor.
• E)No,alterations to the nature of the business require a unanimous vote.

---

Definitions:

Variable Cost

Expenses that adjust in direct correlation with changes in production or sales levels.

Fixed Costs

Expenses that do not change with the level of production or sales activities within a certain range, such as rent, salary, insurance, and loan payments.

Break-even Point

The break-even point is the level of production or sales at which total revenues equal total costs, resulting in no net profit or loss.

Variable Cost

A variable cost changes in proportion to the level of production or business activity, such as raw materials or direct labor expenses.