Question 1

LowPrice Footwear Company contracts to buy 10,000 pairs of boots from Massive Boots,Inc.LowPrice becomes insolvent.Massive may insist that LowPrice

Accepted Answer

A) accept early delivery of the order. 
B) pay cash. 
C) post a bond to guarantee payment. 
D) submit a letter from a court providing assurances of payment. 
A) accept early delivery of the order. 
B) pay cash. 
C) post a bond to guarantee payment. 
D) submit a letter from a court providing assurances of payment. B

Question 2

Incidental damages include all reasonable expenses incurred because of a breach of contract.

Accepted Answer

A) True 
 B)False  True

Question 3

Heavy Concrete Company contracts for a sale of its products to Interstate Construction,Inc.For Heavy to tender delivery of goods,it must

Accepted Answer

A) give Interstate notice to take delivery and hold conforming goods at its disposal. 
B) neither give Interstate notice nor hold conforming goods at its disposal. 
C) only give Interstate notice. 
D) only hold conforming goods at Interstate's disposal. 
A) give Interstate notice to take delivery and hold conforming goods at its disposal. 
B) neither give Interstate notice nor hold conforming goods at its disposal. 
C) only give Interstate notice. 
D) only hold conforming goods at Interstate's disposal. A

Question 4

If a contract does not specify where the goods are to be delivered and the buyer is to pick them up,the place of delivery is the location of the goods.

Accepted Answer

A) True 
 B)False

Question 5

Heavy Equipment,Inc. ,and Ideal Construction Company enter into a con?tract for the sale of a crane.Heavy Equipment does not know that Ideal is insolvent.Ideal sells the crane to Jiffy Build,Inc. ,a good faith purchaser.Heavy Equipment may

Accepted Answer

A) not reclaim the crane. 
B) reclaim the crane if demand is made in a timely manner. 
C) reclaim the crane if Ideal is going out of business entirely. 
D) reclaim the crane if Jiffy Build is paying Interstate for it on credit. 
A) not reclaim the crane. 
B) reclaim the crane if demand is made in a timely manner. 
C) reclaim the crane if Ideal is going out of business entirely. 
D) reclaim the crane if Jiffy Build is paying Interstate for it on credit.

Question 6

Fact Pattern 16-1 
Internet Cafes,Inc. ,contracts to buy all of its requirements for coffee,at a mini?mum of 1 million pounds per year,from Java Corporation for six years.After three years,Internet tells Java that it plans to sell its company to Kwik Eateries,Inc.Kwik refuses to assure Java that it will continue Internet's contract.
-Refer to Fact Pattern 16-1.Java can

Accepted Answer

A) assign its rights under the contract but cannot terminate it. 
B) do nothing. 
C) suspend performance under the contract until Java is fully paid. 
D) terminate the contract and seek damages. 
A) assign its rights under the contract but cannot terminate it. 
B) do nothing. 
C) suspend performance under the contract until Java is fully paid. 
D) terminate the contract and seek damages.

Question 7

When one party fails to cooperate with the other party in carrying out the terms of a contract,the other party may be excused from performing.

Accepted Answer

A) True 
 B)False

Question 8

City Accounting Service pays half of the price for a shipment of computers that remain with the seller,Digital Computers,Inc.Within ten days,Digital becomes insolvent.City can recover the goods if

Accepted Answer

A) City can describe the computers. 
B) City cannot obtain cover. 
C) City expected to obtain the computers within those ten days. 
D) the computers are identified to the contract. 
A) City can describe the computers. 
B) City cannot obtain cover. 
C) City expected to obtain the computers within those ten days. 
D) the computers are identified to the contract.

Question 9

Jivin' Java Company orders coffee beans from Koala Beans Corporation.Jivin' ac?cepts the beans before discovering that they are nonconforming.To re?voke acceptance,Jivin' must notify Koala

Accepted Answer

A) any time. 
B) only after the beans undergo any substantial change not caused by their defects. 
C) only before the beans undergo any substantial change not caused by their defects. 
D) only while the beans undergo any substantial change not caused by their defects. 
A) any time. 
B) only after the beans undergo any substantial change not caused by their defects. 
C) only before the beans undergo any substantial change not caused by their defects. 
D) only while the beans undergo any substantial change not caused by their defects.

Question 10

A buyer who rightfully rejects nonconforming goods can resell the goods and keep the proceeds without accounting to the seller for the amount.

Accepted Answer

A) True 
 B)False

Question 11

On May 1,Silver Star Auto Sales agrees to sell a car to Troy.Five days later,Troy cancels the contract.Silver Star is enti?tled to

Accepted Answer

A) force Troy to take the car. 
B) recover any resulting damages from Troy but not resell the car. 
C) resell the car and recover any resulting damages from Troy. 
D) resell the car but not recover any damages from Troy. 
A) force Troy to take the car. 
B) recover any resulting damages from Troy but not resell the car. 
C) resell the car and recover any resulting damages from Troy. 
D) resell the car but not recover any damages from Troy.

Question 12

If a lessor's tender of delivery fails to conform to a contract in any way,the lessee cannot accept the goods.

Accepted Answer

A) True 
 B)False

Question 13

A seller's tender of goods is a valid tender even if it does not conform to a contract in a minor way.

Accepted Answer

A) True 
 B)False

Question 14

Quality Equipment Company contracts for a sale of goods to Regional Sales Corporation.Quality can enforce its right to payment

Accepted Answer

A) only after Regional has actually inspected the goods. 
B) only after Regional has had an opportunity to inspect the goods. 
C) only before Regional has inspected the goods. 
D) whether or not Regional has had the chance to inspect the goods. 
A) only after Regional has actually inspected the goods. 
B) only after Regional has had an opportunity to inspect the goods. 
C) only before Regional has inspected the goods. 
D) whether or not Regional has had the chance to inspect the goods.

Question 15

Craft Engineering,Inc. ,contracts for a sale of technical instruments to Delta Design Company.Before the date on which performance is due,Craft notifies Delta that it will not perform.This is

Accepted Answer

A) anticipatory repudiation. 
B) perfect tender. 
C) rejection of performance. 
D) revocation of acceptance. 
A) anticipatory repudiation. 
B) perfect tender. 
C) rejection of performance. 
D) revocation of acceptance.

Question 16

Square B Ranch and Tom enter into a contract on August 1 in which Square B agrees to sell 200 cattle to Tom.Tom cancels the con?tract ten days later.Square B is enti?tled to

Accepted Answer

A) force Tom to accept the cattle and recover the contract price. 
B) keep the cattle and recover the contract price from Tom. 
C) recover any resulting damages from Tom. 
D) none of the choices. 
A) force Tom to accept the cattle and recover the contract price. 
B) keep the cattle and recover the contract price from Tom. 
C) recover any resulting damages from Tom. 
D) none of the choices.

Question 17

Goods may be rejected only if they are substantially nonconforming with the terms of the contract.

Accepted Answer

A) True 
 B)False

Question 18

Theatrical Supplies Company contracts to sell to United Costumes & Uniforms,Inc. ,seven hundred plastic masks at $1 each to be delivered by October 1.Theatrical knows that United will use the masks to make Halloween costumes.United usually makes $7,000 profit from the cos?tumes' sale.Theatrical fails to deliver on October 1.United attempts to buy substitute masks,but must pay $1.20 for each and take delivery on October 15,cutting United's sales in half.United sues Theatrical.What is the measure of recovery?

Accepted Answer

The buyer should get the differ?ence bet

Question 19

If,before the time for performance,a buyer communicates an intent not to perform,the seller can consider the buyer in breach and pursue a remedy.

Accepted Answer

A) True 
 B)False

Question 20

A seller can exercise the right to cure within the contract time for performance.

Accepted Answer

A) True 
 B)False

Exam 16: Performance Breach of Sales Lease Contracts

LowPrice Footwear Company contracts to buy 10,000 pairs of boots from Massive Boots,Inc.LowPrice becomes insolvent.Massive may insist that LowPrice

Incidental damages include all reasonable expenses incurred because of a breach of contract.

Heavy Concrete Company contracts for a sale of its products to Interstate Construction,Inc.For Heavy to tender delivery of goods,it must

If a contract does not specify where the goods are to be delivered and the buyer is to pick them up,the place of delivery is the location of the goods.

Heavy Equipment,Inc. ,and Ideal Construction Company enter into a con?tract for the sale of a crane.Heavy Equipment does not know that Ideal is insolvent.Ideal sells the crane to Jiffy Build,Inc. ,a good faith purchaser.Heavy Equipment may

When one party fails to cooperate with the other party in carrying out the terms of a contract,the other party may be excused from performing.

City Accounting Service pays half of the price for a shipment of computers that remain with the seller,Digital Computers,Inc.Within ten days,Digital becomes insolvent.City can recover the goods if

Jivin' Java Company orders coffee beans from Koala Beans Corporation.Jivin' ac?cepts the beans before discovering that they are nonconforming.To re?voke acceptance,Jivin' must notify Koala

A buyer who rightfully rejects nonconforming goods can resell the goods and keep the proceeds without accounting to the seller for the amount.

On May 1,Silver Star Auto Sales agrees to sell a car to Troy.Five days later,Troy cancels the contract.Silver Star is enti?tled to

If a lessor's tender of delivery fails to conform to a contract in any way,the lessee cannot accept the goods.

A seller's tender of goods is a valid tender even if it does not conform to a contract in a minor way.

Quality Equipment Company contracts for a sale of goods to Regional Sales Corporation.Quality can enforce its right to payment

Craft Engineering,Inc. ,contracts for a sale of technical instruments to Delta Design Company.Before the date on which performance is due,Craft notifies Delta that it will not perform.This is

Square B Ranch and Tom enter into a contract on August 1 in which Square B agrees to sell 200 cattle to Tom.Tom cancels the con?tract ten days later.Square B is enti?tled to

Goods may be rejected only if they are substantially nonconforming with the terms of the contract.

If,before the time for performance,a buyer communicates an intent not to perform,the seller can consider the buyer in breach and pursue a remedy.

A seller can exercise the right to cure within the contract time for performance.

The Legal and Constitutional Environment of Business

Traditional and Online Dispute Resolution

Ethics and Business Decision Making

Torts and Cyber Torts

Intellectual Property and Internet Law

Criminal Law and Cyber Crimes

Nature and Classification

Agreement and Consideration

Capacity and Legality

Defenses to Contract Enforceability

Third Party Rights and Discharge

Breach and Remedies

E-Contracts and E-Signatures

The Formation of Sales and Lease Contracts

Title and Risk of Loss

Warranties and Product Liability

Negotiability, transferability, and Liability

Checks and Banking in the Digital Age

Security Interest in Personal Property

Creditors Rights and Bankruptcy

Agency Relationships

Employment Law and Immigration

Sole Proprietorships, partnerships, Ltd Liability

Corporate Formation, financing, and Termination

Corporate Directors, officers, and Shareholders

Investor Protection, insider Trading, Corpgov

Personal Property and Bailments

Real Property and Landlord-Tenant Law

Insurance, wills, and Trusts

Liability of Accountants Other Professionals

International Law in a Global Economy

Regulations, Contracts, and Discovery

Legal Issues in Business and Commerce

Legal Issues in Online Relationships and Agreements

Contracts and Consumer Protection

Liability of Silverado Bank in Prestridge v. Bank of Jena for Forged Checks.

Sovereign Immunity and Bankruptcy Law

Legal Issues in Employment and Liability Cases

Corporate Governance and Securities Law

Real Estate Law: Cases and Controversies

Corporate Ownership and Liability in Chilean Firms

Filters