What Was the Result in the Case Nugget, Lefkowitz V

question 53

Multiple Choice

What was the result in the case nugget, Lefkowitz v. Great Minneapolis Surplus Store, Inc., involving an advertisement for the sale of fur coats?

• A) The court ruled that the advertisement was not an offer because it involved a luxury good.
• B) The court ruled that the advertisement was an offer but that the customer who was suing had not properly accepted it.
• C) The court ruled that the advertisement was not an offer because it was a ridiculously low offer which the plaintiff should have known was not to be taken seriously.
• D) The court ruled that the ad was not an offer because ads are never offers, only invitations for customers to make an offer.
• E) The court ruled that the ad was an offer and that the plaintiff properly accepted it.

Comprehend how activity levels impact variable and fixed costs.

Apply the concept of the activity index and its role in cost behavior analysis.

Calculate and interpret the contribution margin ratio and its significance.

Analyze the impact of sales levels on total costs, variable costs, fixed costs, and net income.

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Definitions:

Sunk Cost

A cost that has already been incurred and cannot be recovered, which should not influence future business decisions.

Stand-Alone Principle

An evaluation method in project management and capital budgeting where a project is assessed on its own merits without considering the company's overall financial position.

Capital Projects

Large, expensive, long-term projects intended to build upon, add to, or improve a property or system.

Operating Cash Flow

A measure of the cash a company generates from its regular business operations, excluding financing and investment activities.