Ray and Strip Mines,Inc

question 1

Multiple Choice

Ray and Strip Mines,Inc. ,enter into a contract for a sale of the coal beneath Ray's land for a fraction of the value of the coal and the cost to restore the land.A court is most likely to determine that this deal is unfair under

• A)the concept of unconscionability.
• B)the doctrine of promissory estoppel.
• C)the principle of freedom of contract.
• D)the Statute of Frauds.

---

Definitions:

Contribution Margin

The residual amount from sales income following the deduction of variable expenses, allocated for covering fixed costs and producing profit.

Variable Costs

Expenses that vary in relation to the amount of production or business activity.

Fixed Costs

Costs that do not change with the level of output produced, such as rent and salaries.

Break-Even Point

The financial analysis term where total costs and total revenues are equal, resulting in no net loss or gain for the business.