Question 1

Delta, Inc., agrees to assume a debt of Excel Company to First State Bank. The agreement is not in writing. To be enforceable, the promise must be for the benefit of
A) any party.
B) Delta.
C) Excel.
D) First State.

Accepted Answer

For the promise to be enforceable without being in writing, it must be for the benefit of the promisor, Delta, under the "main purpose" or "leading object" rule, which is an exception to the Statute of Frauds.

Question 2

Cody and Dora enter into an oral contract under which Cody agrees to work on Dora's farm for not less than one week. This contract is enforce?able by
A) Cody only.
B) Dora only.
C) either party.
D) neither party.

Accepted Answer

Both parties are bound by the terms of an oral contract as long as it meets the necessary elements of a valid contract, such as offer, acceptance, consideration, and intention to create legal relations. Therefore, either party can enforce the contract.

Question 3

AAA Loans, Inc., is one of Beta Business Corporation's creditors. AAA guarantees Beta's debt to City Bank to forestall litigation. To be enforce?able, this guarantee must be in writing
A) to allow Beta to stay in business and pay AAA and City Bank.
B) to allow Beta to stay in business and pay AAA only.
C) to allow Beta to stay in business and pay City Bank only.
D) under no circumstances.

Accepted Answer

A guarantee of debt must be in writing to be enforceable under the Statute of Frauds, regardless of the circumstances or intentions behind the guarantee.

Question 4

International Business, Inc. (IBI), agrees to assume a debt of Southern Export Company to First National Bank. This promise is for the benefit of IBI. To be enforceable, the promise must be in writing if the debt is for
A) $50.
B) $500.
C) $5,000.
D) none of the above.

Accepted Answer

The statute of frauds requires that certain contracts be in writing to be enforceable. One of these is a contract to assume the debt of another. The statute of frauds applies to contracts for the sale of goods for $500 or more, but it does not apply to contracts for the assumption of debt. Therefore, the promise by IBI to assume the debt of Southern Export Company to First National Bank does not need to be in writing to be enforceable.

Question 5

Pacific Applications, Inc., and Quality Resale Company (QRC) enter into an oral contract for Pacific's sale to QRC of six used forklifts for $1,900 each. Before QRC takes posses?sion of the items, this contract is enforceable by
A) either party.
B) neither party.
C) Pacific only.
D) QRC only.

Accepted Answer

The oral contract is unenforceable as it violates the statute of frauds since it involves the sale of goods for over $500. Therefore, neither party can enforce the contract.

Question 6

Andy and Biz Company (BC) enter into an oral contract under which Andy agrees to clean BC's office for two years. This contract is en?forceable by
A) Andy only.
B) BC only.
C) either party.
D) neither party.

Accepted Answer

The Statute of Frauds requires certain contracts, including those that cannot be performed within one year, to be in writing to be enforceable. Since this is a two-year contract and it is oral, it is unenforceable by either party.

Question 7

Ollie buys a cup of coffee for $2, a magazine for $5, and a boombox for $600. The requirement of a writing for the enforceability of a contract for a sale of goods at, or for more than, a certain price is governed by
A) the common law.
B) the parol evidence rule.
C) the parties' agreement.
D) the Uniform Commercial Code.

Accepted Answer

The requirement for the enforceability of a contract for the sale of goods at or above a certain price is governed by the Uniform Commercial Code (UCC), specifically under Article 2. The UCC provides rules and regulations for the sale of goods, such as warranties, delivery, and payment terms. The common law, parol evidence rule, and parties' agreement may also come into play in contract law, but they do not specifically govern the sale of goods as the UCC does.

Question 8

Elle buys a new textbook for $100 and a used car for $5,000, and signs a one-year lease for an apartment for $1,000 monthly rent to start at the beginning of the next month. The Statute of Frauds covers
A) the apartment lease, and the textbook and car purchases.
B) the apartment lease and the car purchase only.
C) the apartment lease only.
D) the textbook and car purchases only.

Accepted Answer

The answer of Elle buys a new textbook for $100...

Question 9

Lyra induces Moe to enter into a contract for the sale of an apartment about which Lyra fraudulently misrepresents a number of material facts. Lyra tells Moe that her commission is 6 percent, but their signed, written contract states "12 percent." The Statute of Frauds governs
A) contracts that are induced by fraud.
B) contracts that must be in writing to be enforceable.
C) the admissibility in court of oral evidence.
D) the reformation of oral and written statements into one contract.

Accepted Answer

The Statute of Frauds governs contracts that must be in writing to be enforceable. The contract for the sale of an apartment would typically fall under this category. Misrepresentation and fraudulent inducement may also be relevant in this situation, but the Statute of Frauds specifically pertains to written contracts.

Question 10

Century Properties. Inc., and Dandy Capital Corporation enter into a con?tract for a sale of land. To be enforceable, the contract must be in writing if the land is valued at
A) $50.
B) $500.
C) $5,000.
D) $50, $500, or $5,000.

Accepted Answer

The correct answer is D because the Statute of Frauds requires contracts for the sale of land to be in writing if the land is valued at $50, $500, or $5,000.

Question 11

Lem buys a used MP3 player for $50 and a new laptop for $1,500, and signs a one-year employment contract for a $4,000 monthly salary to start at the beginning of the next month. The Statute of Frauds covers
A) the employment contract, and the laptop and MP3 purchases.
B) the employment contract and the laptop purchase only.
C) the employment contract only.
D) the laptop and MP3 purchases only.

Accepted Answer

The answer of Lem buys a used MP3 player for...

Question 12

General Contractors (GC) and Holly enter into an oral contract under which Holly agrees to work on a GC project for sixteen months. This con?tract is enforceable by
A) either party.
B) GC only.
C) Holly only.
D) neither party.

Accepted Answer

Under the Statute of Frauds, contracts that cannot be performed within one year must be in writing to be enforceable. Since the contract is for sixteen months, it falls under this requirement and is not enforceable by either party if it is only oral.

Question 13

Ed and First Star Company enter into an oral contract under which Ed agrees to pro?vide delivery service for First Star for nine months. This con?tract is enforceable by
A) Ed only.
B) either party.
C) First Star only.
D) neither party.

Accepted Answer

An oral contract is binding and enforceable by either party. However, it can be difficult to prove the terms of the contract without written documentation.

Question 14

Regional Delivery, Inc., and Safe Storage Company enter into a long-term lease for a warehouse. To be enforceable, the lease must be in writ?ing if the warehouse is valued at
A) $50.
B) $500.
C) $5,000.
D) $50, $500, or $5,000.

Accepted Answer

The Statute of Frauds requires certain contracts, including leases for real property, to be in writing if they are for a term longer than one year, regardless of the value of the property.

Question 15

Lola agrees to assume Mira's debt to New Sales Corporation. Lola does not get any personal benefit for the agreement. To be enforceable, the prom?ise must be in writing if the debt is for
A) $50.
B) $500.
C) $5,000.
D) $50, $500, or $5,000.

Accepted Answer

Under the Statute of Frauds, a promise to pay the debt of another must be in writing to be enforceable, regardless of the amount.

Question 16

Clay buys an MP3 player for $200 and a pair of stereo speakers for $600 from a Discount City store, and downloads $300 worth of digital music from E-Music.com. To be enforceable, the contract that must be in writing is the purchase of
A) the digital music, the MP3 player, and the speakers.
B) the MP3 player and the speakers only.
C) the MP3 player only.
D) the speakers only.

Accepted Answer

The answer of Clay buys an MP3 player for $200...

Question 17

Ilsa and Jiffy Loan Company enter into an oral contract under which Ilsa agrees to pay Kyle's debt if he does not. Ilsa does not get any per?sonal benefit for the agreement. This contract is enforceable by
A) any party.
B) Jiffy only.
C) Jiffy or Kyle.
D) none of the parties.

Accepted Answer

The contract is not enforceable because it is a suretyship agreement, which typically must be in writing to be enforceable under the Statute of Frauds. Since Ilsa does not receive any personal benefit, the oral agreement does not satisfy the exception to the writing requirement.

Question 18

Edy borrows $1,000 from First County Bank. Gil orally promises First County that he will repay the loan if Edy does not. Gil does not get any personal benefit for the promise. Gil's promise is
A) enforceable only if it is in writing.
B) enforceable only if it is oral.
C) enforceable whether it is oral or in writing.
D) not enforceable.

Accepted Answer

Gil's promise is not enforceable because it is an oral promise to pay the debt of another and is not supported by consideration.

Question 19

Timber, Inc., and United Corporation enter into an oral contract for a sale of a lumber mill. Under the Statute of Frauds, before United takes possession, this contract is enforceable by
A) either party.
B) neither party.
C) Timber only.
D) United only.

Accepted Answer

The Statute of Frauds requires that contracts for the sale of real property must be in writing to be enforceable. A lumber mill would be considered real property, and an oral contract for its sale would not be enforceable by either party. Therefore, the answer is B - neither party.

Question 20

Little Goods Store and Major TV Sales Corporation enter into an oral contract for Major's sale to Little of eight DVD players for $100 each. After Little takes possession of the players, but before payment, this contract is
A) enforceable only if it is in writing.
B) enforceable only if it is oral.
C) enforceable whether it is oral or in writing.
D) not enforceable.

Accepted Answer

A contract for the sale of goods can be enforceable whether it is oral or in writing if the price is $500 or less. Since the total price for the eight DVD players (8 x $100) is $800, this contract falls within the scope of the Statute of Frauds (which requires written evidence of certain contracts, including those for the sale of goods over $500). However, the parties have already performed under the contract (Little has taken possession of the players), which is an exception to the Statute of Frauds. Therefore, the contract is enforceable whether it is oral or in writing.

Quiz 15: The Statute of Fraudswriting Requirements

Delta, Inc., agrees to assume a debt of Excel Company to First State Bank. The agreement is not in writing. To be enforceable, the promise must be for the benefit of

Cody and Dora enter into an oral contract under which Cody agrees to work on Dora's farm for not less than one week. This contract is enforce?able by

AAA Loans, Inc., is one of Beta Business Corporation's creditors. AAA guarantees Beta's debt to City Bank to forestall litigation. To be enforce?able, this guarantee must be in writing

International Business, Inc. (IBI) , agrees to assume a debt of Southern Export Company to First National Bank. This promise is for the benefit of IBI. To be enforceable, the promise must be in writing if the debt is for

Pacific Applications, Inc., and Quality Resale Company (QRC) enter into an oral contract for Pacific's sale to QRC of six used forklifts for $1,900 each. Before QRC takes posses?sion of the items, this contract is enforceable by

Andy and Biz Company (BC) enter into an oral contract under which Andy agrees to clean BC's office for two years. This contract is en?forceable by

Ollie buys a cup of coffee for $2, a magazine for $5, and a boombox for $600. The requirement of a writing for the enforceability of a contract for a sale of goods at, or for more than, a certain price is governed by

Elle buys a new textbook for $100 and a used car for $5,000, and signs a one-year lease for an apartment for $1,000 monthly rent to start at the beginning of the next month. The Statute of Frauds covers

Lyra induces Moe to enter into a contract for the sale of an apartment about which Lyra fraudulently misrepresents a number of material facts. Lyra tells Moe that her commission is 6 percent, but their signed, written contract states "12 percent." The Statute of Frauds governs

Century Properties. Inc., and Dandy Capital Corporation enter into a con?tract for a sale of land. To be enforceable, the contract must be in writing if the land is valued at

Lem buys a used MP3 player for $50 and a new laptop for $1,500, and signs a one-year employment contract for a $4,000 monthly salary to start at the beginning of the next month. The Statute of Frauds covers

General Contractors (GC) and Holly enter into an oral contract under which Holly agrees to work on a GC project for sixteen months. This con?tract is enforceable by

Ed and First Star Company enter into an oral contract under which Ed agrees to pro?vide delivery service for First Star for nine months. This con?tract is enforceable by

Regional Delivery, Inc., and Safe Storage Company enter into a long-term lease for a warehouse. To be enforceable, the lease must be in writ?ing if the warehouse is valued at

Lola agrees to assume Mira's debt to New Sales Corporation. Lola does not get any personal benefit for the agreement. To be enforceable, the prom?ise must be in writing if the debt is for

Clay buys an MP3 player for $200 and a pair of stereo speakers for $600 from a Discount City store, and downloads $300 worth of digital music from E-Music.com. To be enforceable, the contract that must be in writing is the purchase of

Ilsa and Jiffy Loan Company enter into an oral contract under which Ilsa agrees to pay Kyle's debt if he does not. Ilsa does not get any per?sonal benefit for the agreement. This contract is enforceable by

Edy borrows $1,000 from First County Bank. Gil orally promises First County that he will repay the loan if Edy does not. Gil does not get any personal benefit for the promise. Gil's promise is

Timber, Inc., and United Corporation enter into an oral contract for a sale of a lumber mill. Under the Statute of Frauds, before United takes possession, this contract is enforceable by

Little Goods Store and Major TV Sales Corporation enter into an oral contract for Major's sale to Little of eight DVD players for $100 each. After Little takes possession of the players, but before payment, this contract is