Sales Part1

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Quiz by harpratap_singh, updated more than 1 year ago
harpratap_singh
Created by harpratap_singh over 4 years ago
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ffff R6 Quiz on Sales Part1, created by harpratap_singh on 06/07/2015.
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Question 1

Question
Under the Sales Article of the UCC, which of the following statements is correct regarding risk of loss and title to the goods under a sale or return contract?
Answer
  • a.Title and risk of loss rest with the buyer until the goods are returned to the seller.
  • b.Title remains with the seller until the buyer approves or accepts the goods, but risk of loss passes to the buyer immediately following delivery of the goods to the buyer.
  • c.Title and risk of loss are shared equally between the buyer and the seller.
  • d.Title and risk of loss remain with the seller until the buyer pays for the goods.

Question 2

Question
An appliance seller promised a restaurant owner that a home dishwasher would fulfill the dishwashing requirements of a large restaurant. The dishwasher was purchased but it was not powerful enough for the restaurant. Under the Sales Article of the UCC, what warranty was violated?
Answer
  • b.The implied warranty of merchantability.
  • c.The express warranty against infringement.
  • a.The implied warranty of marketability.
  • d.The express warranty that the goods conform to the seller's promise.

Question 3

Question
Under the Sales Article of the UCC, which of the following statements is correct regarding a good faith requirement that must be met by a merchant?
Answer
  • a.The merchant must charge the lowest available price for the product in the geographic market.
  • b.The merchant must observe the reasonable commercial standards of fair dealing in the trade.
  • c.The merchant must provide more extensive warranties than the minimum required by law
  • . d.The merchant must adhere to all written and oral terms of the sales contract.

Question 4

Question
Under the Sales Article of the UCC, which of the following statements is correct regarding a seller's obligation under a F.O.B. destination contract?
Answer
  • a.The seller is required to tender delivery of conforming goods to a carrier who delivers to a destination specified by the buyer.
  • b.The seller is required to arrange for the buyer to pick up the conforming goods at a specified destination.
  • c.The seller is required to tender delivery of conforming goods at a specified destination.
  • d.The seller is required to tender delivery of conforming goods at the buyer's place of business.

Question 5

Question
Patch, a frequent shopper at Soon-Shop Stores, received a rain check for an advertised sale item after Soon-Shop's supply of the product ran out. The rain check was in writing and stated that the item would be offered to the customer at the advertised sale price for an unspecified period of time. A Soon-Shop employee signed the rain check. When Patch returned to the store one month later to purchase the item, the store refused to honor the rain check. Under the Sales Article of the UCC, will Patch win a suit to enforce the rain check?
Answer
  • a.No, because the rain check did not state the effective time period necessary to keep the offer open.
  • b.No, because one month is too long a period of time for a rain check to be effective.
  • c.Yes, because the rain check met the requirements of a merchant's firm offer even though no effective time period was stated.
  • d.Yes, because Soon-Shop is required to have sufficient supplies of the sale item to satisfy all customers.

Question 6

Question
A sheep rancher agreed, in writing, to sell all the wool shorn during the shearing season to a weaver. The contract failed to establish the price and a minimum quantity of wool. After the shearing season, the rancher refused to deliver the wool. The weaver sued the rancher for breach of contract. Under the Sales Article of the UCC, will the weaver win?
Answer
  • a.No, because quantity cannot be omitted for a contract to be enforceable.
  • b.Yes, because both price and quantity terms were omitted.
  • c.No, because the omission of price and quantity terms prevents the formation of a contract
  • . d.Yes, because this was an output contract.

Question 7

Question
EG Door Co., a manufacturer of custom exterior doors, verbally contracted with Art Contractors to design and build a $2,000 custom door for a house that Art was restoring. After EG had completed substantial work on the door, Art advised EG that the house had been destroyed by fire and Art was canceling the contract. EG finished the door and shipped it to Art. Art refused to accept delivery. Art contends that the contract cannot be enforced because it violated the Statute of Frauds by not being in writing. Under the Sales Article of the UCC, is Art's contention correct?
Answer
  • a.No, because the cancellation of the contract was not made in writing.
  • b.No, because the goods were specially manufactured for Art and cannot be resold in EG's regular course of business.
  • c.Yes, because the contract cannot be fully performed due to the fire.
  • d.Yes, because the contract was not in writing.

Question 8

Question
Under the Sales Article of the UCC, when a contract for the sale of goods stipulates that the seller ship the goods by common carrier "F.O.B. purchaser's loading dock," which of the parties bears the risk of loss during shipment?
Answer
  • a.The purchaser, because risk of loss passes when the goods are delivered to the carrier.
  • b.The seller, because risk of loss passes only when the goods reach the purchaser's loading dock.
  • c.The purchaser, because title to the goods passes at the time of shipment.
  • d.The seller, because risk of loss remains with the seller until the goods are accepted by the purchaser.

Question 9

Question
Under the Sales Article of the UCC, a firm offer will be created only if the:
Answer
  • a.Offer is made by a merchant in a signed writing.
  • b.Offeree is a merchant.
  • c.Offer states the time period during which it will remain open.
  • d.Offeree gives some form of consideration.

Question 10

Question
Under the Sales Article of the UCC, the warranty of title:
Answer
  • a.Applies only if it is in writing and signed by the seller.
  • b.Provides that the seller cannot disclaim the warranty if the sale is made to a bona fide purchaser for value.
  • c.Applies only if the seller is a merchant.
  • d.Provides that the seller deliver the goods free from any lien of which the buyer lacked knowledge when the contract was made.

Question 11

Question
To establish a cause of action based on strict liability in tort for personal injuries that result from the use of a defective product, one of the elements the injured party must prove is that the seller:
Answer
  • a.Sold the product in a defective condition.
  • b.Sold the product to the injured party.
  • c.Failed to exercise due care.
  • d.Was aware of the defect in the product.

Question 12

Question
Under the Sales Article of the UCC, which of the following factors is most important in determining who bears the risk of loss in a sale of goods contract?
Answer
  • a.The method of shipping the goods.
  • b.The contract's shipping terms.
  • c.Title to the goods.
  • d.How the goods were lost.

Question 13

Question
Under the Sales Article of the UCC, in an F.O.B. place of shipment contract, the risk of loss passes to the buyer when the goods:
Answer
  • a.Are placed on the seller's loading dock.
  • b.Are delivered to the carrier.
  • c.Are identified to the contract.
  • d.Reach the buyer's loading dock.

Question 14

Question
Under the Sales Article of the UCC, and unless otherwise agreed to, the seller's obligation to the buyer is to:
Answer
  • a.Set aside conforming goods for inspection by the buyer before delivery.
  • b.Deliver the goods to the buyer's place of business.
  • c.Deliver all goods called for in the contract to a common carrier.
  • d.Hold conforming goods and give the buyer whatever notification is reasonably necessary to enable the buyer to take delivery.

Question 15

Question
Under the Sales Article of the UCC, which of following statements is correct?
Answer
  • a.The contract must involve the sale of goods for a price of more than $500
  • b.Merchants and nonmerchants are treated alike.
  • c.The obligations of the parties to the contract must be performed in good faith.
  • d.None of the provisions of the UCC may be disclaimed by agreement.

Question 16

Question
Under the Sales Article of the UCC, which of the following statements is correct regarding the warranty of merchantability arising when there has been a sale of goods by a merchant seller?
Answer
  • a.The warranty arises as a matter of law when the seller ordinarily sells the goods purchased.
  • b.The warranty cannot be disclaimed.
  • c.The warranty must be in writing.
  • d.The warranty arises when the buyer relies on the seller's skill in selecting the goods purchased.

Question 17

Question
High sues the manufacturer, wholesaler, and retailer for bodily injuries caused by a power saw High purchased. Which of the following statements is correct under strict liability theory?
Answer
  • a.Contributory negligence on High's part will always be a bar to recovery.
  • b.Privity will be a bar to recovery insofar as the wholesaler is concerned if the wholesaler did not have a reasonable opportunity to inspect.
  • c.High may recover even if he cannot show any negligence was involved.
  • d.The manufacturer will avoid liability if it can show it followed the custom of the industry.

Question 18

Question
Under the Sales Article of the UCC, which of the following events will release the buyer from all its obligations under a sales contract?
Answer
  • a.Anticipatory repudiation by the buyer that is retracted before the seller cancels the contract.
  • b.Destruction of the goods after risk of loss passed to the buyer
  • . c.Impracticability of delivery under the terms of the contract.
  • d.Refusal of the seller to give written assurance of performance when reasonably demanded by the buyer.

Question 19

Question
Rowe Corp. purchased goods from Stair Co. that were shipped C.O.D. Under the Sales Article of the UCC, which of the following rights does Rowe have?
Answer
  • a.The right to delay payment for a reasonable period of time.
  • b.The right to possession of the goods before paying.
  • c.The right to inspect the goods before paying.
  • d.The right to reject nonconforming goods.

Question 20

Question
Under the UCC Sales Article, which of the following statements is correct concerning a contract involving a merchant seller and a non-merchant buyer?
Answer
  • a.Whether the UCC Sales Article is applicable does not depend on the price of the goods involved.
  • b.Only the seller is obligated to perform the contract in good faith.
  • c.The contract may not involve the sale of personal property with a price of more than $500.
  • d.The contract will be either a sale or return or sale on approval contract.

Question 21

Question
Vick bought a used boat from Ocean Marina that disclaimed "any and all warranties" in connection with the sale. Ocean was unaware the boat had been stolen from Kidd. Vick surrendered it to Kidd when confronted with proof of the theft. Vick sued Ocean. Who is likely to prevail and why?
Answer
  • a.Vick, because a merchant cannot disclaim implied warranties.
  • b.Ocean, because of the disclaimer of warranties.
  • c.Ocean, because Vick surrendered the boat to Kidd.
  • d.Vick, because the implied warranty of title has been breached.

Question 22

Question
Quick Corp. agreed to purchase 200 typewriters from Union Suppliers, Inc. Union is a wholesaler of appliances and Quick is an appliance retailer. The contract required Union to ship the typewriters to Quick by common carrier, "FOB Union Suppliers, Inc. Loading Dock." Which of the parties bears the risk of loss during shipment?
Answer
  • a.Quick, because title to the typewriters passed to Quick at the time of shipment.
  • b.Quick, because the risk of loss passes when the typewriters are delivered to the carrier.
  • c.Union, because both parties are merchants.
  • d.Union, because the risk of loss passes only when Quick receives the typewriters.

Question 23

Question
Webstar Corp. orally agreed to sell Northco Inc. a computer for $20,000. Northco sent a signed purchase order to Webstar confirming the agreement. Webstar received the purchase order and did not respond. Webstar refused to deliver the computer to Northco, claiming that the purchase order did not satisfy the UCC Statute of Frauds because it was not signed by Webstar. Northco sells computers to the general public and Webstar is a computer wholesaler. Under the UCC Sales Article, Webstar's position is:
Answer
  • a.Correct because the purchase price of the computer exceeded $500.
  • b.Incorrect because it failed to object to Northco's purchaser order.
  • c.Incorrect because only the buyer in a sale-of-goods transaction must sign the contract.
  • d.Correct because it was the party against whom enforcement of the contract is being sought.

Question 24

Question
Under the UCC Sales Article, which of the following legal remedies would a buyer not have when a seller fails to transfer and deliver goods identified to the contract?
Answer
  • a.Suit for specific performance.
  • b.Recover the identified goods (capture).
  • c.Suit for punitive damages.
  • d.Purchase substitute goods (cover).

Question 25

Question
Under the UCC Sales Article, which of the following legal remedies would a buyer not have when a seller fails to transfer and deliver goods identified to the contract?
Answer
  • a.Suit for specific performance.
  • b.Recover the identified goods (capture).
  • c.Suit for punitive damages.
  • d.Purchase substitute goods (cover).

Question 26

Question
Which of the following statements applies to a sale on approval under the UCC Sales Article?
Answer
  • a.The buyer must be purchasing the goods for resale.
  • b.Both the buyer and seller must be merchants.
  • c.Title to the goods passes to the buyer on delivery of the goods to the buyer.
  • d.Risk of loss for the goods passes to the buyer when the goods are accepted after the trial period.

Question 27

Question
Which of the following statements would not apply to a written contract governed by the provisions of the UCC Sales Article?
Answer
  • a.The obligations of the parties must be performed in good faith.
  • b.The obligations of a nonmerchant may be different from those of a merchant.
  • c.The contract must involve the sale of goods for a price of $500 or more.
  • d.The contract may involve the sale of personal property.

Question 28

Question
To establish a cause of action based on strict liability in tort for personal injuries resulting from using a defective product, one of the elements the plaintiff must prove is that the seller (defendant):
Answer
  • a.Was in privity of contract with the plaintiff.
  • b.Was engaged in the business of selling the product.
  • c.Failed to exercise due care.
  • d.Defectively designed the product

Question 29

Question
Bond purchased a painting from Wool, who is not in the business of selling art. Wool tendered delivery of the painting after receiving payment in full from Bond. Bond informed Wool that Bond would be unable to take possession of the painting until later that day. Thieves stole the painting before Bond returned. The risk of loss:
Answer
  • a.Remained with Wool because the parties agreed on a later time of delivery.
  • b.Passed to Bond at Wool's tender of delivery.
  • c.Remained with Wool because Bond had not yet received the painting.
  • d.Passed to Bond at the time the contract was formed and payment was made.

Question 30

Question
Smith contracted in writing to sell Peters a used personal computer for $600. The contract did not specifically address the time for payment, place of delivery, or Peters' right to inspect the computer. Which of the following statements is correct?
Answer
  • a.Smith is not entitled to payment until 30 days after Peters receives the computer.
  • b.Peters is entitled to inspect the computer before paying for it.
  • c.Peters may not pay for the computer using a personal check unless Smith agrees.
  • d.Smith is obligated to deliver the computer to Peters' home.

Question 31

Question
Cara Fabricating Co. and Taso Corp. agreed orally that Taso would custom manufacture a compressor for Cara at a price of $120,000. After Taso completed the work at a cost of $90,000, Cara notified Taso that the compressor was no longer needed. Taso is holding the compressor and has requested payment from Cara. Taso has been unable to resell the compressor for any price. Taso incurred storage fees of $2,000. If Cara refuses to pay Taso and Taso sues Cara, the most Taso will be entitled to recover is:
Answer
  • a.$92,000
  • b.$105,000
  • c.$120,000
  • d.$122,000

Question 32

Question
Grill deals in the repair and sale of new and used clocks. West brought a clock to Grill to be repaired. One of Grill's clerks mistakenly sold West's clock to Hone, another customer. Under the Sales Article of the UCC, will West win a suit against Hone for the return of the clock?
Answer
  • a.No, because Grill is a merchant to whom goods had been entrusted.
  • b.Yes, because Grill could not convey good title to the clock.
  • c.No, because the clerk was not aware that the clock belonged to West
  • . d.Yes, because the clerk was negligent in selling the clock.

Question 33

Question
Under the Sales Article of the UCC, which of the following statements is correct regarding the creation of express warranties?
Answer
  • a.Express warranties cannot be based on statements made in the seller's promotional materials.
  • b.Express warranties must contain formal words such as warranty or guarantee.
  • c.Express warranties are not enforceable if made orally.
  • d.Express warranties must be part of the basis of the bargain between buyer and seller.

Question 34

Question
Under the UCC Sales Article, the implied warranty of merchantability:
Answer
  • a.May be disclaimed by a seller's oral statement that mentions merchantability.
  • b.Must be part of the basis of the bargain to be binding on the seller
  • . c.Is breached if the goods are not fit for all purposes for which the buyer intends to use the goods.
  • d.Arises only in contracts involving a merchant seller and a merchant buyer.

Question 35

Question
Yost Corp., a computer manufacturer, contracted to sell 15 computers to Ivor Corp., a computer retailer. The contract specified that delivery was to be made by truck to Ivor's warehouse. Instead, Yost shipped the computers by rail. When Ivor claimed that Yost did not comply with the contract, Yost told Ivor that there had been a trucker's strike when the goods were shipped. Ivor refused to pay for the computers. Under these circumstances, Ivor:
Answer
  • a.Is obligated to pay for the computers because title to them passed to Ivor when Ivor received them.
  • b.Is obligated to pay for the computers because Yost made a valid substituted performance.
  • c.May return the computers and avoid paying for them because of the way Yost delivered them.
  • d.May return the computers and avoid paying for them because the contract was void under the theory of commercial impracticability.

Question 36

Question
On May 2, Lace Corp., an appliance wholesaler, offered to sell appliances worth $3,000 to Parco, Inc., a household appliance retailer. The offer was signed by Lace's president, and provided that it would not be withdrawn before June 1. It also included the shipping terms: "F.O.B.-Parco's warehouse." On May 29, Parco mailed an acceptance of Lace's offer. Lace received the acceptance on June 2. If Lace inadvertently ships the wrong appliances to Parco and Parco rejects them two days after receipt, title to the goods will:
Answer
  • a.Pass to Parco when they are identified to the contract.
  • b.Remain with Parco until the goods are returned to Lace.
  • c.Revert to Lace when they are rejected by Parco.
  • d.Pass to Parco when they are shipped.

Question 37

Question
On May 2, Mason orally contracted with Acme Appliances to buy for $480 a washer and dryer for household use. Mason and the Acme salesperson agreed that delivery would be made on July 2. On May 5, Mason telephoned Acme and requested that the delivery date be moved to June 2. The Acme salesperson agreed with this request. On June 2, Acme failed to deliver the washer and dryer to Mason because of an inventory shortage. Acme advised Mason that it would deliver the appliances on July 2 as originally agreed. Mason believes that Acme has breached its agreement with Mason. Acme contends that its agreement to deliver on June 2 was not binding. Acme's contention is:
Answer
  • a.Correct, because the agreement to change the delivery date was not in writing.
  • b.Incorrect, because Acme's agreement to change the delivery date is a firm offer that cannot be withdrawn by Acme.
  • c.Incorrect, because the agreement to change the delivery date was binding.
  • d.Correct, because Mason is not a merchant and was buying the appliances for household use.

Question 38

Question
On February 15, Mazur Corp. contracted to sell 1,000 bushels of wheat to Good Bread, Inc. at $6.00 per bushel with delivery to be made on June 23. On June 1, Good advised Mazur that it would not accept or pay for the wheat. On June 2, Mazur sold the wheat to another customer at the market price of $5.00 per bushel. Mazur had advised Good that it intended to resell the wheat. Which of the following statements is correct?
Answer
  • a.Good can successfully sue Mazur for specific performance.
  • b.Mazur can resell the wheat only after June 23.
  • c.Mazur can successfully sue Good for the difference between the resale price and the contract price.
  • d.Good can retract its anticipatory breach at any time before June 23.

Question 39

Question
Cookie Co. offered to sell Distrib Markets 20,000 pounds of cookies at $1.00 per pound, subject to certain specified terms for delivery. Distrib replied in writing as follows: "We accept your offer for 20,000 pounds of cookies at $1.00 per pound, weighing scale to have valid city certificate." Under the UCC:
Answer
  • a.A contract was formed between the parties.
  • b.A contract will be formed only if Cookie agrees to the weighing scale requirement.
  • c.No contract was formed because Distrib's reply was a counteroffer.
  • d.No contract was formed because Distrib included the weighing scale requirement in its reply.

Question 40

Question
Party A contracts for the sale of widgets to Party B. Before the date on which performance is due, Party B notifies Party A that it will not perform. This is a(an):
Answer
  • a.Perfect tender.
  • b.Rejection of performance.
  • c.Anticipatory repudiation.
  • d.Anticipatory retribution.

Question 41

Question
To determine whether the products that a merchant sells to the public are merchantable, a key factor to examine is whether:
Answer
  • a.The products are made according to the best manufacturing methods.
  • b.The products are fit for the ordinary purpose for which such goods are used.
  • c.The manufacturer violated any laws or regulations.
  • d.The products are quality products that are fit for a specific purpose.

Question 42

Question
Under the Sales Article of the UCC, which of the following requirements must be met for a writing to be an enforceable contract for the sale of goods?
Answer
  • a.The writing must contain the signatures of all parties to the writing.
  • b.The writing must contain a term specifying the quantity of the goods.
  • c.The writing must contain the signature of the party seeking to enforce the writing.
  • d.The writing must contain a term specifying the price of the goods.

Question 43

Question
When do title and risk of loss for conforming goods pass to the buyer under a shipment contract covered by the Sales Article of the UCC?
Answer
  • a.When the goods are tendered to the buyer at their destination.
  • b.When the goods arrive at their destination.
  • c.When the goods are given to a common carrier.
  • d.When the goods are identified and designated for shipment.

Question 44

Question
Under the Sales Article of the UCC, which of the following circumstances best describes how the implied warranty of fitness for a particular purpose arises in a sale of goods transaction?
Answer
  • a.The buyer is purchasing the goods for a particular purpose and is relying on the seller's skill or judgment to select suitable goods.
  • b.The seller knows the particular purpose for which the buyer will use the goods and knows the buyer is relying on the seller's skill or judgment to select suitable goods.
  • c.The buyer is purchasing the goods for a particular purpose and the seller is a merchant in such goods.
  • d.The seller knows the particular purpose for which the buyer will use the goods and the seller is a merchant in such goods
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