Heather Innocently Misrepresented the Status of a Puppy as Being

question 42

Multiple Choice

Heather innocently misrepresented the status of a puppy as being a full blooded Pomeranian when actually it was a mixed breed. Brad had contracted to purchase the dog, but the problem was discovered prior to his paying for the dog and picking it up. Nevertheless, Brad was very angry and felt that Heather should have been more careful. He said that he planned to rescind the contract and also sue her for damages to punish her and deter others from behaving similarly. Which of the following is true regarding the remedies available to Brad?

• A) Because Heather violated the contract to provide a full blooded Pomeranian, Brad is entitled to rescind the contract and also to the damages he seeks.
• B) Because Heather violated the contract to provide a full blooded Pomeranian, Brad is entitled to rescind the contract, but he is not entitled to the damages he seeks.
• C) Because Heather is not guilty of any wrongdoing, Brad is entitled to no remedy; and Heather has an additional 30 days in order to honor the contract.
• D) Because Heather is not guilty of any wrongdoing, Brad is entitled to no remedy; and Heather has an additional 60 days in order to honor the contract.
• E) Because Heather is not guilty of any wrongdoing, Brad is entitled to no remedy; and Heather has an additional 90 days in order to honor the contract.

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Definitions:

Flexible Manufacturing Budget

A budget that adjusts to changes in the volume of production, providing variable costs based on different levels of activity.

Standard Cost Accounting System

A standard cost accounting system estimates the cost of production in advance, using standard costs for materials, labor, and overhead for cost control and performance evaluation.

Direct Labor Payroll

The total cost of wages and benefits paid to employees who are directly involved in the production of goods or delivery of services.

Predetermined Overhead Rate

An estimated rate used to allocate manufacturing overhead costs to individual products or job orders based on a predetermined base, such as labor hours or machine hours.