Question 1

Five Star Flooring orders carpet from Textile Mills Corporation,but Textile does not deliver.Five Star will probably be unable to enforce the agreement if the parties omitted
A)a delivery term.
B)a payment term.
C)a quantity term.
D)a price term.

Accepted Answer

A contract for the sale of goods must include a quantity term to be enforceable under the Uniform Commercial Code (UCC).

Question 2

Fresh Harvest,Inc. ,agrees to sell to Gina's Bed & Breakfast Inn a certain amount of locally grown produce each week but no mention is made of where the goods are to be delivered.In general,the UCC requires that the delivery take place at
A)a neutral place of business halfway between the parties' locations.
B)a "reasonable" place of delivery.
C)Fresh Harvest's place of business.
D)Gina's place of business.

Accepted Answer

The answer of Fresh Harvest,Inc. ,agrees to sell to Gina's...

Question 3

Consuelo and Gabriela enter into a contract for a sale of saxophones and other brass instruments.Consuelo delivers,but Gabriela does not pay.Consuelo can normally recover as damages
A)any profit lost minus any loss avoided.
B)whatever amount the seller wishes to claim.
C)the purchase price plus incidental damages.
D)the market price at the place at which the seller delivered the goods.

Accepted Answer

According to the UCC (Uniform Commercial Code), the seller can normally recover as damages the purchase price plus any incidental damages in a case where the buyer has not paid for the goods. Therefore, choice C is the correct answer. Choice A is incorrect because it only considers the profit lost and ignores any loss avoided. Choice B is incorrect because the seller cannot claim any arbitrary amount, it must be reasonable and related to the damages incurred. Choice D is incorrect because the market price at the place of delivery may not be the same as the purchase price and may not accurately reflect the damages incurred by the seller.

Question 4

Quinn enters into a series of agreements with Reba involving a sale of a Suite Dreams Motel,including the land,building,furnishings,shares of stock in Suite Dreams Company,and a contract with Trudy to create an ad campaign.Reba suspects that Quinn may be misrepresenting the facts.The UCC Statute of Frauds governs the sale of
A)any of the property evidenced by a writing.
B)any of the property that may involve fraud.
C)the furnishings priced at $500 or more.
D)the land and the building.

Accepted Answer

The answer of Quinn enters into a series of agreements...

Question 5

Concrete Products,Inc. ,assures Deepwater Construction Company (DCC)that Concrete's cement will not crack within a certain range of pressure.This "assurance" is
A)puffery.
B)an express warranty.
C)an implied warranty.
D)a warranty of title.

Accepted Answer

This statement made by Concrete Products, Inc. is an express warranty, which is a specific statement or promise made by the seller regarding the quality, features or performance of the product. By providing an assurance that their cement will not crack within a certain range of pressure, Concrete Products, Inc. is making a specific promise to DCC about the quality of their product.

Question 6

Sari buys a new sport utility vehicle (SUV)from 'Tastic Cars & Trucks,Inc.The most important factor in determining whether an express warranty is created is whether
A)Sari expresses to 'Tastic what she wants warranted.
B)Sari's desire for the SUV becomes part of her motivation to deal.
C)'Tastic expresses to Sari what it expects of its customers.
D)'Tastic's promise becomes part of the basis of the bargain.

Accepted Answer

The most important factor in determining whether an express warranty is created is whether 'Tastic's promise becomes part of the basis of the bargain. This means that the promise made by 'Tastic must have influenced Sari's decision to buy the SUV. Without this promise, there would be no basis for warranty. Therefore, option D is the correct answer.

Question 7

Pop Culture Clothiers,Inc. ,sells t-shirts to Trendwell Stores,Inc. ,under an existing contract.When textile costs increase,Trendwell agrees to a price increase,but later wants to cancel the contract.Trendwell may
A)cancel the contract immediately.
B)cancel the contract only after accepting a final shipment.
C)cancel the contract only on reasonable notice.
D)not cancel the contract.

Accepted Answer

The answer of Pop Culture Clothiers,Inc. ,sells t-shirts to Trendwell...

Question 8

Inst-ee Gadgets,Inc. ,and Jolly Outlets Corporation enter into a contract for a sale of kitchenware.The contract requires Inst-ee to deliver the goods to Ladle Carrier Company for transport to Jolly's warehouse in Metro City.Risk of loss passes to Jolly when
A)Inst-ee delivers the goods to Ladle.
B)Inst-ee identifies the goods to the contract.
C)Ladle transports the goods to Jolly's warehouse.
D)the goods arrive in Metro City.

Accepted Answer

In a shipment contract, risk of loss passes to the buyer when the seller delivers the goods to the carrier.

Question 9

Howe enters into a contract with Ida over the Internet to buy soybeans as a hedge against falling prices in corn.Neither party prints out a hard copy.Under the federal Electronic Signatures in Global and National Commerce Act (E-SIGN Act),this contract can
A)be denied effect if it falls under the UCC's Statute of Frauds.
B)be denied effect unless a hard copy is printed.
C)be denied effect until it is executed.
D)not be denied effect because it is only in electronic form.

Accepted Answer

According to the E-SIGN Act, contracts cannot be denied effect solely because they are in electronic form. Therefore, this contract between Howe and Ida over the Internet to buy soybeans is enforceable even if a hard copy is not printed.

Question 10

Town Style Stores orders Hidebound-brand leather jackets from Cowhide & Cotton Company (CCC).CCC mistakenly ships denim jackets,which Town rejects and returns via Valu Transport,Inc.During the return,the jackets are lost.The loss is suffered by
A)Town.
B)Hidebound.
C)Valu.
D)CCC.

Accepted Answer

The answer of Town Style Stores orders Hidebound-brand leather jackets...

Question 11

Olga,a salesperson for Pre-owned Cars & Trucks,Inc. ,tells Quincy,"This is the best car I've ever seen." This statement is
A)an express warranty.
B)an implied warranty.
C)a warranty of title.
D)puffery.

Accepted Answer

The statement "This is the best car I've ever seen" is an example of puffery, which is an exaggerated or subjective statement that is not meant to be taken literally or as a guarantee of quality. Therefore, it is not considered a warranty.

Question 12

Recycle Packaging,Inc. ,agrees to sell 50,000 6-ounce yogurt containers to Organic Dairy Company.Recycle can obtain only 20,000 of the 6-ounce containers,but also ships 30,000 more expensive 8-ounce containers for the same price.Organic rejects the 8-ounce containers.With time for performance not yet expired,Recycle can
A)attempt to cure the defect.
B)cancel the contract.
C)recover the purchase price plus incidental damages.
D)resell or dispose of the goods and hold Organic liable for any loss.

Accepted Answer

Recycle can attempt to cure the defect by either finding more 6-ounce containers or replacing the 8-ounce containers with 6-ounce ones. This would allow Recycle to still fulfill the contract and avoid any potential damages or cancellation of the contract by Organic.

Question 13

Cheesy Pizza Company contracts to sell 1,000 cases of frozen pizzas to Roller Rinks,Inc. ,but refuses to deliver.Due to a spice shortage,Roller Rinks cannot obtain pizza elsewhere.Roller Rinks's right to recover the goods from Cheesy is the right of
A)cover.
B)cure.
C)replevin.
D)specific performance.

Accepted Answer

Replevin is the legal right to recover possession of personal property that has been wrongfully taken. In this case, Cheesy Pizza Company wrongfully refused to deliver the pizzas that Roller Rinks had contracted for and Roller Rinks cannot obtain the pizzas elsewhere due to a spice shortage. Roller Rinks has the right to recover the pizzas from Cheesy Pizza Company through replevin.

Question 14

Mitchell buys 100 bales of hay from New Grain Fields.The parties agree that the hay will be transported "F.O.B.New Grain Fields" via Farm County Trucking Company.Farm County's truck and the hay are lost in a fire following an accident.The loss is suffered by
A)Mitchell.
B)New Grain Fields.
C)Farm County Trucking.
D)all of the parties in equal measure.

Accepted Answer

The loss is suffered by Mitchell because F.O.B. (Free on Board) means that the seller (New Grain Fields) is responsible for the goods until they are loaded onto the shipping vehicle, which in this case is Farm County Trucking Company. Once the goods are loaded, the responsibility shifts to the buyer (Mitchell), and any loss or damage that occurs during transportation is his responsibility.

Question 15

Woodgrain Products Company and Sylvia enter into a contract for a sale of lumber.Woodgrain knows the purpose for which Sylvia will use the goods.Under the UCC,an implied warranty of fitness of a particular purpose arises
A)if the buyer is relying on the seller to select suitable goods.
B)if the buyer asks for it.
C)if the seller is a merchant who deals in goods of the kind sold.
D)in conjunction with lease contracts,not sales contracts.

Accepted Answer

The answer of Woodgrain Products Company and Sylvia enter into...

Question 16

Over the course of a year,Retail Market,Inc. ,sells goods from its inventory and one of its warehouses.In exchange,Retail receives checks and other items that substitute for cash,which Retail uses to repay a loan from Savers Bank.Article 2 of the UCC governs
A)the checks.
B)the payment of the loan.
C)the sale of the buildings.
D)the sale of the goods.

Accepted Answer

Article 2 of the UCC specifically governs the sale of goods. Therefore, the sale of goods by Retail Market, Inc. would fall under the purview of the UCC. The other options, such as the payment of the loan and the sale of the buildings, may be governed by different sections of the UCC or by other laws. However, the UCC is primarily concerned with the sale of goods and would be the relevant governing law in this situation.

Question 17

Nature's Foods,Inc. ,orders "Grade A" oil from Olive Grove Farms to process and sell to Pic 'N Pay Grocers.Olive Grove ships "Grade B" oil,which Nature's Foods accepts.To recover damages for the nonconformity,Nature's Foods must give notice of the breach within a reasonable time to
A)Olive Grove.
B)Pic 'N Pay.
C)no one.
D)the appropriate government agency.

Accepted Answer

Nature's Foods must give notice of the breach to Olive Grove, as they are the party responsible for delivering non-conforming goods. Pic 'N Pay is not directly involved in the situation, so they do not need to be notified. The government agency may be involved if there are violations of any laws or regulations, but this would not be the first step in handling the breach.

Question 18

Overseas Corporation (OC),a U.S.firm,orally agrees to sell six freezers to Pisa Pizza,Ltd. ,in Italy.OC fails to deliver.Under the CISG,Pisa Pizza can
A)enforce the agreement.
B)not enforce the agreement because it is not in writing.
C)not enforce the agreement because the price term is not specified.
D)not enforce the agreement because there is no consideration.

Accepted Answer

The CISG allows for oral contracts to be enforceable, and since there is no indication that Pisa Pizza failed to fulfill their part of the agreement, they are entitled to enforce it. The lack of a written contract or a specified price term do not necessarily invalidate the agreement under the CISG.

Question 19

Flem,a user of GameCenter.com's Web site,can download gaming software if he first clicks on "I accept" after viewing certain terms.If Flem clicks and downloads,this is
A)a contract that does not include the terms.
B)a contract that includes the terms only if Flem read them.
C)a contract that includes the terms whether or not Flem read them.
D)not a contract.

Accepted Answer

By clicking on "I accept" after viewing certain terms, Flem is agreeing to those terms, regardless of whether or not they actually read them. This creates a valid contract that includes the terms.

Question 20

Rachel enters into a contract with State University over the Internet to take an online course titled "Online Law." This is an e-contract because
A)the contract involves an online course.
B)the contract was formed online.
C)the contract will be performed online.
D)the subject matter of the contract is "Online Law."

Accepted Answer

An e-contract is a contract that is formed online. In this scenario, Rachel entered into a contract with State University over the Internet, making it an e-contract. The fact that the course is online and will be performed online is not what makes it an e-contract, but rather the fact that the contract was formed over the Internet.

Quiz 11: Sales,leases,and E-Contracts

Five Star Flooring orders carpet from Textile Mills Corporation,but Textile does not deliver.Five Star will probably be unable to enforce the agreement if the parties omitted

Fresh Harvest,Inc. ,agrees to sell to Gina's Bed & Breakfast Inn a certain amount of locally grown produce each week but no mention is made of where the goods are to be delivered.In general,the UCC requires that the delivery take place at

Consuelo and Gabriela enter into a contract for a sale of saxophones and other brass instruments.Consuelo delivers,but Gabriela does not pay.Consuelo can normally recover as damages

Concrete Products,Inc. ,assures Deepwater Construction Company (DCC) that Concrete's cement will not crack within a certain range of pressure.This "assurance" is

Sari buys a new sport utility vehicle (SUV) from 'Tastic Cars & Trucks,Inc.The most important factor in determining whether an express warranty is created is whether

Pop Culture Clothiers,Inc. ,sells t-shirts to Trendwell Stores,Inc. ,under an existing contract.When textile costs increase,Trendwell agrees to a price increase,but later wants to cancel the contract.Trendwell may

Inst-ee Gadgets,Inc. ,and Jolly Outlets Corporation enter into a contract for a sale of kitchenware.The contract requires Inst-ee to deliver the goods to Ladle Carrier Company for transport to Jolly's warehouse in Metro City.Risk of loss passes to Jolly when

Howe enters into a contract with Ida over the Internet to buy soybeans as a hedge against falling prices in corn.Neither party prints out a hard copy.Under the federal Electronic Signatures in Global and National Commerce Act (E-SIGN Act) ,this contract can

Town Style Stores orders Hidebound-brand leather jackets from Cowhide & Cotton Company (CCC) .CCC mistakenly ships denim jackets,which Town rejects and returns via Valu Transport,Inc.During the return,the jackets are lost.The loss is suffered by

Olga,a salesperson for Pre-owned Cars & Trucks,Inc. ,tells Quincy,"This is the best car I've ever seen." This statement is

Cheesy Pizza Company contracts to sell 1,000 cases of frozen pizzas to Roller Rinks,Inc. ,but refuses to deliver.Due to a spice shortage,Roller Rinks cannot obtain pizza elsewhere.Roller Rinks's right to recover the goods from Cheesy is the right of

Mitchell buys 100 bales of hay from New Grain Fields.The parties agree that the hay will be transported "F.O.B.New Grain Fields" via Farm County Trucking Company.Farm County's truck and the hay are lost in a fire following an accident.The loss is suffered by

Woodgrain Products Company and Sylvia enter into a contract for a sale of lumber.Woodgrain knows the purpose for which Sylvia will use the goods.Under the UCC,an implied warranty of fitness of a particular purpose arises

Over the course of a year,Retail Market,Inc. ,sells goods from its inventory and one of its warehouses.In exchange,Retail receives checks and other items that substitute for cash,which Retail uses to repay a loan from Savers Bank.Article 2 of the UCC governs

Nature's Foods,Inc. ,orders "Grade A" oil from Olive Grove Farms to process and sell to Pic 'N Pay Grocers.Olive Grove ships "Grade B" oil,which Nature's Foods accepts.To recover damages for the nonconformity,Nature's Foods must give notice of the breach within a reasonable time to

Overseas Corporation (OC) ,a U.S.firm,orally agrees to sell six freezers to Pisa Pizza,Ltd. ,in Italy.OC fails to deliver.Under the CISG,Pisa Pizza can

Flem,a user of GameCenter.com's Web site,can download gaming software if he first clicks on "I accept" after viewing certain terms.If Flem clicks and downloads,this is

Rachel enters into a contract with State University over the Internet to take an online course titled "Online Law." This is an e-contract because