Question 1

Which of the following is the right to insure goods against any risk exposure such as damage or destruction?

Accepted Answer

A)  An insurable interest 
B)  A compensable interest 
C)  A paid interest 
D)  A collateral interest 
E)  A valid interest 
A)  An insurable interest 
B)  A compensable interest 
C)  A paid interest 
D)  A collateral interest 
E)  A valid interest

Question 2

Tender of delivery is the moment goods are picked up by the buyer.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following requires that the seller make proper shipping arrangements and deliver goods to the buyer via a common carrier but not guarantee the safety of goods to their destination?

Accepted Answer

A)  Origin contracts 
B)  Destination contracts 
C)  Transfer contracts 
D)  Common-carrier contracts 
E)  Risk contracts 
A)  Origin contracts 
B)  Destination contracts 
C)  Transfer contracts 
D)  Common-carrier contracts 
E)  Risk contracts

Question 4

FOB and FAS are different terms with the same meaning.

Accepted Answer

A) True 
 B)False

Question 5

What is the most common way a sales contract is breached? Discuss the available remedies of a buyer in the event a seller does not provide goods described in the contract along with UCC provisions regarding the consequences of a revocation of the contract.

Accepted Answer

The failure to deliver goods is the most

Question 6

Assume a buyer and seller execute a contract in which the seller is going to deliver a couch later in the day to the buyer. With a simple delivery contract in which the seller is a merchant, which party sustains a loss if, through no fault of either party, the couch is destroyed through fire prior to delivery?

Accepted Answer

A)  The seller 
B)  The buyer 
C)  Loss is proportioned 50% to the buyer and 50% to the seller 
D)  Loss is proportioned 75% to the buyer and 25% to the seller 
E)  Loss is proportioned 25% to the buyer and 75% to the seller 
A)  The seller 
B)  The buyer 
C)  Loss is proportioned 50% to the buyer and 50% to the seller 
D)  Loss is proportioned 75% to the buyer and 25% to the seller 
E)  Loss is proportioned 25% to the buyer and 75% to the seller

Question 7

Belinda purchases a couch from Good Furniture Store to use in her home. She pays for the couch, and the store agrees to deliver it. Unfortunately, on the way to her house, the vehicle overheats and burns, destroying the truck and the couch inside. Belinda asks for a refund or another couch. The store owner refuses on the basis that risk of loss had passed to Belinda. What would be the result of a lawsuit between Belinda and Good Furniture Store under the UCC?

Accepted Answer

Under the UCC, since the store is a merc

Question 8

Discuss when title and risk of loss pass to the buyer in a goods-in-bailment contract when (a) the seller has a negotiable document of title (b) the seller has a nonnegotiable document of title and (c) the seller has a contract or other instrument showing ownership that is not a negotiable or nonnegotiable document of title.

Accepted Answer

(a) If the seller has a negotiable docum

Question 9

Which of the following are types of conditional contracts?

Accepted Answer

A)  Sale-on-approval contracts, but not sale-or-return or condition-or-sale contracts 
B)  Sale-or-return contracts and condition-or-sale contracts, but not sale-on-approval contracts 
C)  Condition-or-sale contracts and sale-on-approval contracts, but not sale-or-return contracts 
D)  Sale-on-approval contracts, sale-or-return contracts, and condition-or-sale contracts 
E)  Sale-on-approval contracts and sale-or-return contracts, but not condition-or-sale contracts 
A)  Sale-on-approval contracts, but not sale-or-return or condition-or-sale contracts 
B)  Sale-or-return contracts and condition-or-sale contracts, but not sale-on-approval contracts 
C)  Condition-or-sale contracts and sale-on-approval contracts, but not sale-or-return contracts 
D)  Sale-on-approval contracts, sale-or-return contracts, and condition-or-sale contracts 
E)  Sale-on-approval contracts and sale-or-return contracts, but not condition-or-sale contracts

Question 10

List and describe good title and void title, and give an example of when void title would be passed.

Accepted Answer

Good title is title that is ac

Question 11

Which of the following is true when the designation FAS is used?

Accepted Answer

A)  The buyer, at the buyer's expense, delivers the goods alongside the ship before the risk passes to the seller. 
B)  The buyer, at the seller's expense, delivers the goods alongside the ship before the risk passes to the seller. 
C)  The seller, at the seller's expense, delivers the goods alongside the ship before the risk passes to the buyer. 
D)  The seller, at the buyer's expense, delivers the goods alongside the ship before the risk passes to the buyer. 
E)  The common carrier, at the carrier's expense, delivers the goods alongside the ship before the risk passes to the buyer. 
A)  The buyer, at the buyer's expense, delivers the goods alongside the ship before the risk passes to the seller. 
B)  The buyer, at the seller's expense, delivers the goods alongside the ship before the risk passes to the seller. 
C)  The seller, at the seller's expense, delivers the goods alongside the ship before the risk passes to the buyer. 
D)  The seller, at the buyer's expense, delivers the goods alongside the ship before the risk passes to the buyer. 
E)  The common carrier, at the carrier's expense, delivers the goods alongside the ship before the risk passes to the buyer.

Question 12

The rule originates in common law that when a seller transfers goods to a buyer, the buyer gets only voidable title if the buyer is a minor.

Accepted Answer

A) True 
 B)False

Question 13

With a simple delivery contract, when does title transfer to the buyer?

Accepted Answer

A)  When money is transferred 
B)  When the items are delivered 
C)  When the buyer takes possession 
D)  One day after goods are identified to the contract 
E)  When goods are identified to the contract 
A)  When money is transferred 
B)  When the items are delivered 
C)  When the buyer takes possession 
D)  One day after goods are identified to the contract 
E)  When goods are identified to the contract

Question 14

Which of the following was the result in Landshire Food Service Inc., v. Coghill, the case in the text in which the defendant, Coghill, sold his Rolls Royce to Bellman in return for a forged cashier's check and an innocent purchaser for value, Hyken, meanwhile purchased the car from Bellman before the fraud was discovered?

Accepted Answer

A)  Coghill was entitled to return of the vehicle because the contract with Bellman was void. 
B)  Coghill was entitled to return of the vehicle because the contract with Bellman was voidable by Coghill. 
C)  Hyken was entitled to the vehicle because a person who procures title through fraud receives voidable title and is able to transfer good title to a bona fide purchaser. 
D)  Hyken was entitled to the vehicle because although a person who procures title through fraud receives a void title, the person guilty of fraud may transfer good title to a bona fide purchaser. 
E)  The car was ordered sold with Coghill and Hyken to split the proceeds. 
A)  Coghill was entitled to return of the vehicle because the contract with Bellman was void. 
B)  Coghill was entitled to return of the vehicle because the contract with Bellman was voidable by Coghill. 
C)  Hyken was entitled to the vehicle because a person who procures title through fraud receives voidable title and is able to transfer good title to a bona fide purchaser. 
D)  Hyken was entitled to the vehicle because although a person who procures title through fraud receives a void title, the person guilty of fraud may transfer good title to a bona fide purchaser. 
E)  The car was ordered sold with Coghill and Hyken to split the proceeds.

Question 15

Assume a buyer and seller execute a contract in which the seller is going to deliver a couch later in the day to the buyer. With a simple delivery contract in which the seller is not a merchant, which party sustains a loss if, through no fault of either party, the couch is destroyed through fire prior to delivery?

Accepted Answer

A)  The seller 
B)  The buyer 
C)  Loss is proportioned 50% to the buyer and 50% to the seller 
D)  Loss is proportioned 75% to the buyer and 25% to the seller 
E)  Loss is proportioned 25% to the buyer and 75% to the seller 
A)  The seller 
B)  The buyer 
C)  Loss is proportioned 50% to the buyer and 50% to the seller 
D)  Loss is proportioned 75% to the buyer and 25% to the seller 
E)  Loss is proportioned 25% to the buyer and 75% to the seller

Question 16

Which of the following would the absence of words "to the order of" indicate in a goods-in-bailment contract?

Accepted Answer

A)  A negotiable document 
B)  A nonnegotiable document 
C)  A shipment contract 
D)  An origin contract 
E)  Nothing, there is no such thing as a goods-in-bailment contract 
A)  A negotiable document 
B)  A nonnegotiable document 
C)  A shipment contract 
D)  An origin contract 
E)  Nothing, there is no such thing as a goods-in-bailment contract

Question 17

Which of the following occurs when the purchased goods are transferred to the buyer from the seller at either the time of the sale or some time later by the seller's delivery?

Accepted Answer

A)  A voidable delivery contract 
B)  An average delivery contract 
C)  A simple delivery contract 
D)  A complex delivery contract 
E)  An acknowledged sale 
A)  A voidable delivery contract 
B)  An average delivery contract 
C)  A simple delivery contract 
D)  A complex delivery contract 
E)  An acknowledged sale

Question 18

Delivering a car to a merchant for repair cannot qualify as an entrustment.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following is true regarding transportation costs when the designation FOB is used?

Accepted Answer

A)  The selling price includes transportation costs. 
B)  The selling price does not include transportation costs. 
C)  The buyer and seller bear transportation costs with the costs apportioned at a rate of 50% to the buyer and 50% to the seller. 
D)  The buyer and seller with the loss being proportioned 75% to the buyer and 25% to the seller. 
E)  The buyer and seller with the loss being proportioned 25% to the buyer and 75% to the seller. 
A)  The selling price includes transportation costs. 
B)  The selling price does not include transportation costs. 
C)  The buyer and seller bear transportation costs with the costs apportioned at a rate of 50% to the buyer and 50% to the seller. 
D)  The buyer and seller with the loss being proportioned 75% to the buyer and 25% to the seller. 
E)  The buyer and seller with the loss being proportioned 25% to the buyer and 75% to the seller.

Question 20

Which of the following occurs in a CIF agreement?

Accepted Answer

A)  Risk of loss occurs when goods are identified to the contract. 
B)  Risk of loss occurs when the goods are delivered to the buyer. 
C)  Risk of loss remains with the seller for 5 days after the sale. 
D)  Risk of loss remains with the seller for 5 days before the sale. 
E)  The seller puts the goods in possession of a carrier before the risk passes to the buyer. 
A)  Risk of loss occurs when goods are identified to the contract. 
B)  Risk of loss occurs when the goods are delivered to the buyer. 
C)  Risk of loss remains with the seller for 5 days after the sale. 
D)  Risk of loss remains with the seller for 5 days before the sale. 
E)  The seller puts the goods in possession of a carrier before the risk passes to the buyer.

Exam 22: Title, Risk of Loss, and Insurable Interest

Which of the following is the right to insure goods against any risk exposure such as damage or destruction?

Tender of delivery is the moment goods are picked up by the buyer.

Which of the following requires that the seller make proper shipping arrangements and deliver goods to the buyer via a common carrier but not guarantee the safety of goods to their destination?

FOB and FAS are different terms with the same meaning.

What is the most common way a sales contract is breached? Discuss the available remedies of a buyer in the event a seller does not provide goods described in the contract along with UCC provisions regarding the consequences of a revocation of the contract.

Which of the following are types of conditional contracts?

List and describe good title and void title, and give an example of when void title would be passed.

Which of the following is true when the designation FAS is used?

The rule originates in common law that when a seller transfers goods to a buyer, the buyer gets only voidable title if the buyer is a minor.

With a simple delivery contract, when does title transfer to the buyer?

Which of the following would the absence of words "to the order of" indicate in a goods-in-bailment contract?

Which of the following occurs when the purchased goods are transferred to the buyer from the seller at either the time of the sale or some time later by the seller's delivery?

Delivering a car to a merchant for repair cannot qualify as an entrustment.

Which of the following is true regarding transportation costs when the designation FOB is used?

Which of the following occurs in a CIF agreement?

An Introduction to Dynamic Business Law

Business Ethics

The US Legal System

Alternative Dispute Resolution

Constitutional Principles

International and Comparative Law

Crime and the Business Community

Tort Law

Negligence and Strict Liability

Product Liability

Liability of Accountants and Other Professionals

Intellectual Property

Introduction to Contracts

Agreement

Consideration

Capacity and Legality

Legal Assent

Contracts in Writing

Third-Party Rights to Contracts

Discharge and Remedies

Introduction to Sales and Lease Contracts

Performance and Obligations Under Sales and Leases

Remedies for Breach of Sales and Lease Contracts

Warranties

Negotiable Instruments: Negotiability and Transferability

Negotiation, Holder in Due Course, and Defenses

Liability, Defenses, and Discharge

Checks and Electronic Fund Transfers

Secured Transactions

Other Creditors Remedies and Suretyship

Bankruptcy and Reorganization

Agency Formation and Duties

Liability to Third Parties and Termination

Forms of Business Organization

Partnerships: Nature, Formation, and Operation

Partnerships: Termination and Limited Partnerships

Corporations: Formation and Financing

Corporations: Directors, Officers, and Shareholders

Corporations: Mergers, Consolidations, Terminations

Corporations: Securities and Investor Protection

Employment and Labor Law

Employment Discrimination

Administrative Law

Consumer Law

Environmental Law

Antitrust Law

The Nature of Property, Personal Property, and Bailments

Real Property

Landlord-Tenant Law

Insurance Law

Wills and Trusts

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