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Law
Q:
A contract between Fresh Fruit Corporation and Green Grocer, Inc., requires Fresh Fruit to deliver goods to Green Grocer's place of business. This is
a. a bill of lading.
b. a destination contract.
c. a shipment contract.
d. a warehouse receipt.
Q:
Grace purchases three tons of fine merino wool on behalf of Woolen Creations. Woolen Creations wants the wool to remain in the warehouse where it is being stored until it is needed. Grace makes an offer for the wool on Monday. The offer is accepted on Tuesday. The warehouser gives Woolen Creations a warehouse receipt on Wednesday. Woolen Creations picks up the wool from the warehouse three months after the sale. Title for the wool passed to Woolen creations
a. on Monday.
b. on Tuesday.
c. on Wednesday.
d. three months after the sale.
Q:
Megan, an agent for a department store, orders one hundred dresses from Sal's Clothing Shop for the Spring Blossom Sale. There is no specific agreement in the sale contract indicating when title will pass to the department store. The title will pass to the department store when
a. Megan signs the contract.
b. Megan and the Sal's Clothing Shop agent sign the contract.
c. Sal's Clothing Shop physically delivers the dresses to the department store.
d. Megan pays Sal's Clothing Shop for the dresses.
Q:
Ralph, a representative for Statewide Truck & Transport Company, delivers a warehouse receipt to Thelma, the owner of United Storage Warehouse. A warehouse receipt is
a. an invoice for payment for loading and carting verified by a seller.
b. an order to ship goods signed by a buyer.
c. a receipt for goods signed by a carrier.
d. a receipt issued by a warehouser for goods in a warehouse.
Q:
Corn that fills County Grain Co-op's silo is fungible if the corn is
a. alike naturally, by agreement, or by trade usage.
b. fundamentally different.
c. fun, good, and edible.
d. rotting due to a leaky roof and a delay in shipping.
Q:
Equipment Rentals Corporation (ERC) agrees to lease two backhoes to Dig & Fill Construction, Inc. Before any interest in the backhoes can pass from ERC to Dig & Fill, they must be
a. in existence and identified as the goods in the contract.
b. in ERC's physical possession.
c. in Dig & Fill's physical possession.
d. listed in a document of title and filed in the appropriate state office.
Q:
Bill orders 1,000 nails from Super Hardware, Inc. Super Hardware keeps its nails in packages of 100,000. Bill and the agent for Super Hardware both sign the contract for the sale of the nails on Monday. The agent separates 1,000 nails on Wednesday. The agent delivers the nails to Bill on Thursday morning, and Bill pays for the nails on Friday. Identification of the nails took place on
a. Monday.
b. Wednesday.
c. Thursday.
d. Friday.
Q:
Big Beef, Inc. raises calves to sell. Big Beef breeds its cows in April, and the cows calve in February of the following year. In January Andrea contracts with Big Beef to buy fifty calves. Identification takes place in
a. January, when the contract is signed.
b. April, when the calves are conceived.
c. February, when the calves are born.
d. a reasonable period of time.
Q:
Jason contracts with Golf Carts Unlimited, Inc. to buy five golf carts. The contract lists the five carts as GC001, GC002, GC003, GC004, GC005. Identification
a. requires that Jason verify his identity to take possession of the carts.
b. has taken place.
c. cannot take place until the contract is reviewed by a court.
d. will take place only when Jason pays for the golf carts.
Q:
NutriRich, Inc., sells fifty cases of Omega 3 capsules to Good Health stores, but before Good Health takes physical possession, the cases are lost. Under the UCC, the parties' rights and obligations with respect to the loss depend on the concept of
a. identification.
b. insurable interest.
c. risk of loss.
d. title.
Q:
A seller has an insurable interest in goods as long as he or she retains title to the goods.
Q:
A buyer has an insurable interest in identified goods only if he or she has title to the goods.
Q:
Before a seller can have an insurable interest in goods, the goods must be identified to a contract.
Q:
A buyer and a seller cannot normally have an insurable interest in identical goods at the same time.
Q:
The right to cure is the right of a party who tenders nonconforming performance to correct his or her performance within the contract period.
Q:
If a buyer accepts a shipment of goods and later discovers a defect, acceptance cannot be revoked.
Q:
If the tender or delivery of goods is so nonconforming that the buyer has the right to reject them, the risk of loss does not pass to the buyer until cure or acceptance.
Q:
When a buyer breaches a contract, the risk of loss immediately shifts to the buyer.
Q:
If the goods are so nonconforming that the buyer has the right to reject them, the risk of loss does not pass to the buyer.
Q:
If a lessor is a merchant, the risk of loss passes to a lessee on the lessee's receipt of the goods.
Q:
When a seller keeps the goods for pickup, if the seller is a merchant, the risk of loss passes to a buyer when the buyer actually takes physical possession of the goods.
Q:
The risk of loss in a shipment contract passes to the buyer when the goods are delivered to the carrier.
Q:
If a seller is not a merchant, and the goods are not to be moved, the risk of loss passes to a buyer on tender of delivery.
Q:
The contract term "delivery ex-ship" means that the risk of loss does not pass to the buyer until the goods are properly unloaded from the ship or other carrier.
Q:
The contract term "free on board" indicates that the selling price of goods includes transportation costs to the specific F.O.B. place named in the contract.
Q:
Under a destination contract, the risk of loss passes to the buyer when the goods are duly delivered to the carrier.
Q:
When the risk of loss for goods passes from a seller to a buyer is generally determined by the contract between the parties.
Q:
Under the UCC, the risk of loss necessarily passes with title.
Q:
A seller with voidable title can transfer good title to a good faith purchaser for value.
Q:
Entrusting goods to a merchant who deals in goods of the kind gives the merchant the power to transfer all rights to a buyer in the ordinary course of business.
Q:
When a document of title is required, title passes to a buyer when and where the document is delivered.
Q:
In a destination contract, the seller is required to deliver the goods to a particular destination.
Q:
A receipt issued by a warehouser for goods stored in a warehouse is a bill of lading.
Q:
A warehouse receipt is a receipt signed by a warehouse for goods stored in a warehouse.
Q:
Generally, all contracts are assumed to be shipment contracts if nothing to the contrary is stated in the contract.
Q:
Identification takes place when specific goods are designated as the subject mater of a sales or lease contract.
Q:
If an owner holds fungible goods as a tenant in common, he or she can pass title without actually separating the goods.
Q:
Fungible goods are goods that are alike naturally, by agreement, or by trade usage.
Q:
In contracts involving a sale of unborn animals to be born within twelve months, identification takes place when the animals are born.
Q:
If a sale involves crops that are to be harvested within twelve months, identification takes place when the seeds for the crops are purchased.
Q:
Future goods are goods that are not both existing and identified to the contract.
Q:
Even if goods are not identified to the contract, the title and risk of loss can still pass from the seller to the buyer.
Q:
Before any interest in specific goods can pass from the seller to the buyer, the goods must exist and be identified to the contract.
Q:
Identification, risk of loss, and insurable interest are all concepts that are involved in determining the rights and liabilities of parties to a contract.
Q:
In most situations involving sales, rights and liabilities are determined by who has the title to the goods.
Q:
Peter, an agent for Zippy Cars, Inc., writes a letter to Cassandra on March 1 stating that he will sell her a 2011 Suburu Outback for $20,000 between March 1 and April 30. Peter's letter to Cassandra is
a. a firm offer.
b. an acceptance.
c. a bilateral contract.
d. a breach.
Q:
Rice River Farms offers to sell Sensei Sushi Restaurants, Inc., five hundred bushels of rice. Sensei responds, "We agree to buy five hundred bushels only if the rice is Grade A quality." This statement is
a. a breach.
b. a counteroffer.
c. a confirmation.
d. an acceptance.
Q:
TalkTalk, Inc., offers to buy from Voice Media Corporation (VMC) 100,000 smartphones. Without notifying TalkTalk, VMC timely ships phones of a different quality. With respect to the offer and a possible contract, this shipment is
a. an acceptance and a breach.
b. an acceptance and an accommodation.
c. an acceptance and complete performance.
d. a rejection and a counteroffer.
Q:
FlavorBean Coffee Company agrees to buy an unspecified quantity of coffee beans from Global AgriCorp. Global breaches the contract. In FlavorBean's suit to obtain relief, the court will most likely
a. award a reasonable quantity of beans to FlavorBean.
b. award FlavorBean all the beans that it requires.
c. award Global's output of coffee beans to FlavorBean.
d. have no basis for determining a remedy.
Q:
Refined Grains, Inc., agrees to sell to Sunny Breakfast Cereal Company a certain quantity of refined oats 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. Refined's place of business.
d. Sunny's place of business.
Q:
Car n" Truck Body & Paint Company orders custom paint from Diverse Hues Inc., but Diverse does not deliver. Car n" Truck will probably be unable to enforce the agreement if the parties omitted
a. a price term.
b. a payment term.
c. a quantity term.
d. shipping arrangements.
Q:
Quality Metals Company and Superior Fabrication, Inc., enter into a contract under which Quality Metals agrees to deliver a certain quantity of sheet metal to Superior Fabrication each month. The contract does not include a price term. In a suit between the parties over the price, a court will
a. determine a reasonable price.
b. impose the lowest market price.
c. impose the highest market price.
d. return the parties to the positions they held before the contract.
Q:
Roy's Chick"n Shack orders chicken from Standard Food Supplier, but Standard does not deliver. Roy's will probably be unable to enforce the agreement if the parties
a. did not limit the duration of the deal.
b. did not specify a payment term.
c. did not specify a quantity term.
d. have not begun to perform.
Q:
Marine Expeditions, Inc., pays Nate's Boats $4,000 to use an oceangoing vessel for a month. For the purposes of the UCC, this is
a. a service contract.
b. a gift.
c. a lease.
d. a sale.
Q:
Jamie is redoing his kitchen and decides he needs a floor sander to complete the job. Jamie tells Rachel, his neighbor, that he needs a floor sander. Rachel tells Jamie to call Home Repair Rentals, Inc. Home Repair Rentals leases Jamie a floor sander. In this transaction the lessor is
a. Jamie.
b. Rachel.
c. Home Repair Rentals.
d. both Jamie and Rachel.
Q:
Cam enters into a contract with Tractors & Lifts Lease Company for a two-year lease of a backhoe. This contract is subject to
a. Article 2 of UCC.
b. Article 2A of the UCC.
c. Article 11 of the CISG.
d. the common law only.
Q:
Medico Inc. enters into a contract to sell medical supplies to New Hospital Corporation, which sells some of the items to Physicians Clinic, which later sells them to Oscar, a patient and consumer. Article 2 of the UCC applies to the sales transactions between
a. all buyers and sellers.
b. Medico and New Hospital only.
c. New Hospital and Physicians Clinic only.
d. Physicians Clinic and Oscar only.
Q:
Danko sells new and used sports equipment to persons who come into his store, Eyes on the Prize. One afternoon, Danko sells a used display shelf to Felipe. At a garage sale at his home, Danko sells a used flat-screen TV to Faye. Under the UCC, Danko is a merchant of
a. sports equipment only.
b. sports equipment and display shelves only.
c. sports equipment, display shelves, and flat-screen TVs.
d. anything that he chooses to sell.
Q:
In a dispute over a sale involving a restored 1937 Ford Roadster, Garth argues that for the purpose of the sale, Hoyt's Pawn Shop, where Garth bought the auto, is a merchant. A court may determine whether Hoyt's is a merchant by assessing whether
a. it has sold any restored autos within the last year.
b. it holds itself out by occupation as having knowledge or skill unique to the auto in the transaction.
c. its owner enjoys motoring.
d. it subscribes to Restoration, a biweekly trade magazine.
Q:
Dan, a computer programmer, holds a garage sale to sell a lawnmower, some clothes, some CDs and some old clothes. Will, a lawyer, sells Thelma his collection of seashells. Philip, a CEO of a successful company, sells George his pet parakeet. Judy, an expert horse trainer, sells Bob a horse. Which person would be considered a merchant under the UCC?
a. Dan
b. Will
c. Judy
d. Philip
Q:
Orange Manufacturing Corporation (OMC) orders twelve job-training and on-the-job safety DVDs from Plum Productions, Inc., which delivers the disks to OMC's plant. This is most likely
a. a gift.
b. a lease of goods.
c. a sale of goods.
d. a service contract.
Q:
Over the course of a year, Discount Market Company sells goods from its inventory and also sells one of its warehouses. In exchange, Discount receives checks, which Discount uses to repay a loan from Evermore Credit Inc. 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.
Q:
Canyon Creek Corporation is a Delaware-based firm that does business throughout the United States. With respect to this circumstance, the UCC has been adopted by, and applies in,
a. a few of the states.
b. all of the states, in whole or in part.
c. half of the states.
d. none of the states, to date.
Q:
Precise Engineering, P.C., is a California-based firm that does business with clients throughout North America. Precise Engineering plans and executes construction projects, and buys and sells developed and undeveloped land, and related equipment and supplies. Precise Engineering has had to confront work-site theft and vandalism. With respect to these circumstances, the Uniform Commercial Code (UCC) provides a framework for
a. commercial transactions for the sale of and payment for goods.
b. international construction contracts.
c. domestic and foreign transactions in real estate.
d. prosecuting crimes against business interests.
Q:
An unconscionable contract is one that is so unfair and one sided that it would be unreasonable to enforce it.
Q:
A court can refuse to enforce a contract that the court deems to have been unconscionable at the time it was made.
Q:
In interpreting a commercial agreement, a court will assume that the usage of trade was taken into account when the agreement was phrased.
Q:
A course of performance is the conduct that occurs under the terms of a particular agreement.
Q:
Under the UCC, the meaning of any agreement must be interpreted in light of commercial practices.
Q:
The terms of a fully integrated contract can be contradicted by evidence of any prior agreements.
Q:
All oral contracts are enforceable under the UCC.
Q:
Under the UCC, an agreement modifying a contract needs no consideration to be binding.
Q:
If a nonmerchant-seller's offer expressly conditions acceptance on a nonmerchant-buyer's agreement to the terms of the offer, the buyer's positive response is an acceptance even if it contains additional terms.
Q:
The UCC requires that the mirror image rule be followed for all acceptances.
Q:
Under the UCC, if a contract is unilateral, the offeror must be notified of the offeree's performance.
Q:
Under the UCC, prompt shipment of goods is considered an acceptance of an offer to buy the goods.
Q:
Generally, acceptance of an offer to lease goods may be made in any reasonable manner and by any reasonable means.
Q:
Under the UCC, a firm offer for a sale or lease of goods made by a merchant without consideration can be revoked at any time before acceptance.
Q:
If there is no definite period stated, a firm offer by a merchant is irrevocable without the necessity of consideration for up to six months.
Q:
A firm offer by a merchant may be oral.