Question 1

Who among the following is most likely not considered a merchant according to Article 2 of the UCC?

Accepted Answer

A) Jim who owns a wholesale auto parts business. 
B) Tom who, as a hobby, builds and sells birdhouses on the weekends. 
C) Kay who sells her 3-year-old fishing boat to her neighbor. 
D) Jan who is not knowledgeable about selling sailboats, but employs an experienced person in the trade. 
A) Jim who owns a wholesale auto parts business. 
B) Tom who, as a hobby, builds and sells birdhouses on the weekends. 
C) Kay who sells her 3-year-old fishing boat to her neighbor. 
D) Jan who is not knowledgeable about selling sailboats, but employs an experienced person in the trade. C

Question 2

Under the Code, a contract to sell or lease personal property is recognized whenever the parties manifest such an intent, even if they cannot identify a precise moment the contract was formed.

Accepted Answer

A) True 
 B)False  True

Question 3

Which of the following is correct with respect to finance leases?

Accepted Answer

A) A finance lease generally involves three parties instead of two. 
B) A finance lessor supplies the goods. 
C) The finance lessor typically has special expertise as to the goods. 
D) All of these are correct. 
A) A finance lease generally involves three parties instead of two. 
B) A finance lessor supplies the goods. 
C) The finance lessor typically has special expertise as to the goods. 
D) All of these are correct. A

Question 4

Which of the following is correct with respect to Article 2A of the UCC?

Accepted Answer

A) It is an analogue of Article 2 that adopts many of the same rules. 
B) No states have as yet adopted 2A. 
C) Article 2A specifically includes security interests in its scope. 
D) All of these. 
A) It is an analogue of Article 2 that adopts many of the same rules. 
B) No states have as yet adopted 2A. 
C) Article 2A specifically includes security interests in its scope. 
D) All of these.

Question 5

A finance lease is a special type of lease transaction that generally involves three parties instead of two.

Accepted Answer

A) True 
 B)False

Question 6

Karen has agreed to buy May's car, but the two have not agreed on the price.When there is no agreement in a sales contract as to price, what effect does it have on the contract?

Accepted Answer

A) There is a contract, with the price being whatever the seller decides. 
B) There is a contract, with the price being a reasonable price at the time the agreement was made. 
C) There is no contract, because the agreement is not definite and certain enough. 
D) There is a contract, with the price being a reasonable price at the time of delivery. 
A) There is a contract, with the price being whatever the seller decides. 
B) There is a contract, with the price being a reasonable price at the time the agreement was made. 
C) There is no contract, because the agreement is not definite and certain enough. 
D) There is a contract, with the price being a reasonable price at the time of delivery.

Question 7

"Goods" for purposes of the Code are essentially tangible, movable personal property.

Accepted Answer

A) True 
 B)False

Question 8

Andrew has a contract to buy 100 tables from Bartholomew at a price of $50 a table.Five days before Bartholomew is to deliver the tables, he tells Andrew that he is sorry, but $50 won't cover his costs; he will need at least $75 a table.Andrew agrees, because he needs the tables for his special sale.The modified contract is enforceable without new consideration, so long as Bartholomew is acting in good faith.

Accepted Answer

A) True 
 B)False

Question 9

The UCC provides rules, where the parties do not set forth terms in their contract, to cover:

Accepted Answer

A) terms of payment. 
B) place of delivery. 
C) particulars of performance. 
D) All of these. 
A) terms of payment. 
B) place of delivery. 
C) particulars of performance. 
D) All of these.

Question 10

Which of the following is not considered "goods" within the meaning of Article 2?

Accepted Answer

A) An unborn calf 
B) A field of corn still in the field 
C) Timber which is still standing 
D) All of these are goods under Article 2. 
A) An unborn calf 
B) A field of corn still in the field 
C) Timber which is still standing 
D) All of these are goods under Article 2.

Question 11

"Acceptance" under the UCC always means taking possession of goods.

Accepted Answer

A) True 
 B)False

Question 12

If a seller buries important terms of its sales agreement in fine print, this could constitute procedural unconscionability, which could result in a court's refusal to enforce the entire sales contract or at least the part the court finds unconscionable.

Accepted Answer

A) True 
 B)False

Question 13

The common law "mirror image" rule has been modified by the Code.

Accepted Answer

A) True 
 B)False

Question 14

If a contract does not comply with the statute of frauds, it is void.

Accepted Answer

A) True 
 B)False

Question 15

Until the early 1900s, sales transactions were completely governed by general contract law, but now sales of tangible personal property are predominantly governed by statute.

Accepted Answer

A) True 
 B)False

Question 16

Shannon orally agrees to buy 500 telephone answering machines from Thomas for $25,000.Thomas delivers 300 answering machines to Shannon, who receives and accepts them.Which of the following is correct with regard to this transaction?

Accepted Answer

A) Shannon can enforce the contract for the additional 200 machines. 
B) The contract is enforceable only to the extent of the 300 machines that have been received and accepted. 
C) The entire contract is in violation of the statute of frauds and cannot be enforced. 
D) This is a bad deal and therefore unconscionable and unenforceable from the beginning. 
A) Shannon can enforce the contract for the additional 200 machines. 
B) The contract is enforceable only to the extent of the 300 machines that have been received and accepted. 
C) The entire contract is in violation of the statute of frauds and cannot be enforced. 
D) This is a bad deal and therefore unconscionable and unenforceable from the beginning.

Question 17

A "sale," as defined by the UCC, takes place when:

Accepted Answer

A) the price is paid. 
B) there is a manifestation of mutual assent. 
C) the parties shake hands or affirmatively agree. 
D) the title is transferred to the buyer. 
A) the price is paid. 
B) there is a manifestation of mutual assent. 
C) the parties shake hands or affirmatively agree. 
D) the title is transferred to the buyer.

Question 18

Gary, a partner in G & R Enterprises, went to a trade show and discussed with a manufacturer's representative of Foods 4 U, Inc.the purchase of three dozen food processors.A week after the trade show Gary received a signed letter from the representative thanking Gary for visiting his booth and saying Gary's order for three dozen Style 418B food processors at $90 each would be shipped to his business address within 30 days.Can Gary be contractually bound to accept and pay for the food processors?

Accepted Answer

A) If, after he returns from the trade show, Gary decides he only wants to purchase twelve food processors, he would not have to pay for three dozen if they are shipped to him as long as he notifies Foods 4 U of the change in quantity before it ships the goods. 
B) Gary did not sign an order form, and an order this large would have to be in writing and signed by Gary to be enforceable. 
C) If Gary does not object in writing within ten days after receiving the letter, he can be bound to accept and pay for the three dozen food processors. 
D) The letter is not sufficient to bind either Gary or Foods 4 U, Inc.to the purchase and sale of the food processors. 
A) If, after he returns from the trade show, Gary decides he only wants to purchase twelve food processors, he would not have to pay for three dozen if they are shipped to him as long as he notifies Foods 4 U of the change in quantity before it ships the goods. 
B) Gary did not sign an order form, and an order this large would have to be in writing and signed by Gary to be enforceable. 
C) If Gary does not object in writing within ten days after receiving the letter, he can be bound to accept and pay for the three dozen food processors. 
D) The letter is not sufficient to bind either Gary or Foods 4 U, Inc.to the purchase and sale of the food processors.

Question 19

In a contract to sell goods, the sale does not take place until the seller transfers the title to the goods to the buyer.

Accepted Answer

A) True 
 B)False

Question 20

Mary and Renaldi Co.have dealt with each other for many, many years.Mary's Boutique orders 100 assorted lipsticks at $3.00 each from Renaldi Co.Renaldi sends back a confirmation letter stating that the shipment will be made by UPS rather than by U.S.mail as usual.There is:

Accepted Answer

A) no contract, but a counteroffer. 
B) a contract for shipment by UPS unless Mary objects. 
C) a contract for shipment by UPS only if Mary agrees. 
D) a contract for shipment by U.S.mail. 
A) no contract, but a counteroffer. 
B) a contract for shipment by UPS unless Mary objects. 
C) a contract for shipment by UPS only if Mary agrees. 
D) a contract for shipment by U.S.mail.

Exam 21: Introduction to Sales and Leases

Who among the following is most likely not considered a merchant according to Article 2 of the UCC?

Under the Code, a contract to sell or lease personal property is recognized whenever the parties manifest such an intent, even if they cannot identify a precise moment the contract was formed.

Which of the following is correct with respect to finance leases?

Which of the following is correct with respect to Article 2A of the UCC?

A finance lease is a special type of lease transaction that generally involves three parties instead of two.

Karen has agreed to buy May's car, but the two have not agreed on the price.When there is no agreement in a sales contract as to price, what effect does it have on the contract?

"Goods" for purposes of the Code are essentially tangible, movable personal property.

The UCC provides rules, where the parties do not set forth terms in their contract, to cover:

Which of the following is not considered "goods" within the meaning of Article 2?

"Acceptance" under the UCC always means taking possession of goods.

If a seller buries important terms of its sales agreement in fine print, this could constitute procedural unconscionability, which could result in a court's refusal to enforce the entire sales contract or at least the part the court finds unconscionable.

The common law "mirror image" rule has been modified by the Code.

If a contract does not comply with the statute of frauds, it is void.

Until the early 1900s, sales transactions were completely governed by general contract law, but now sales of tangible personal property are predominantly governed by statute.

Shannon orally agrees to buy 500 telephone answering machines from Thomas for $25,000.Thomas delivers 300 answering machines to Shannon, who receives and accepts them.Which of the following is correct with regard to this transaction?

A "sale," as defined by the UCC, takes place when:

In a contract to sell goods, the sale does not take place until the seller transfers the title to the goods to the buyer.

Mary and Renaldi Co.have dealt with each other for many, many years.Mary's Boutique orders 100 assorted lipsticks at $3.00 each from Renaldi Co.Renaldi sends back a confirmation letter stating that the shipment will be made by UPS rather than by U.S.mail as usual.There is:

Introduction to Law

Business Ethics and the Social Responsibility of Business

Civil Dispute Resolution

Constitutional Law

Administrative Law

Criminal Law

Intentional Torts

Negligence and Strict Liability

Introduction to Contracts

Mutual Assent

Conduct Invalidating Assent

Consideration

Illegal Bargains

Contractual Capacity

Contracts in Writing

Third Parties to Contracts

Performance, Breach, and Discharge

Contract Remedies

Relationship of Principal and Agent

Relationship With Third Parties

Performance

Transfer of Title and Risk of Loss

Products Liability: Warranties and Strict Liability in Tort

Sales Remedies

Form and Content

Transfer and Holder in Due Course

Liability of Parties

Bank Deposits, Collections, and Funds Transfers

Formation and Internal Relations of General Partnerships

Operation and Dissolution of General Partnerships

Limited Partnerships and Limited Liability Companies

Nature, Formation, and Powers

Financial Structure

Management Structure

Fundamental Changes

Secured Transactions and Suretyship

Bankruptcy

Protection of Intellectual Property

Antitrust

Consumer Protection

Employment Law

Securities Regulation

Accountants Legal Liability

Environmental Law

International Business Law

Introduction to Property, Property Insurance, Bailments, and Documents of Title

Interests in Real Property

Transfer and Control of Real Property

Trusts and Decedents Estates

51: The Legal Environment Of Business

52: Contracts.

53: Agency.

54: Sales

55: Negotiable Instruments

56: Unincorporated Business Association

57: Corporations

58: Debtor and Creditor Relation

59: Regulation of Business

60: Property.

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