Question 1

In contracts involving a carrier, a seller can complete performance only through a destination contract.

Accepted Answer

A) True 
 B)False

Question 2

Pep Paints agrees to sell to Quality Painters Grade A-1 latex outdoor paint to be delivered May 8. On May 7, Pep tenders Grade B-2 paint. Quality re?jects the Grade B-2 paint. Two days later, Pep tenders Grade C-3 paint with an offer of a price allowance. Pep has

Accepted Answer

A)  additional, unlimited time to cure. 
B)  a reasonable, additional time to cure. 
C)  one more day to cure. 
D)  no more time to cure. 
A)  additional, unlimited time to cure. 
B)  a reasonable, additional time to cure. 
C)  one more day to cure. 
D)  no more time to cure.

Question 3

A buyer may reject a seller's goods only if they fail to conform to a mate?rial term of the contract.

Accepted Answer

A) True 
 B)False

Question 4

The term cure refers to the right of the seller to reject, adjust, or replace nonconforming goods.

Accepted Answer

A) True 
 B)False

Question 5

A buyer has no right to accept goods that fail in any respect to conform to the terms of a contract in every detail.

Accepted Answer

A) True 
 B)False

Question 6

A seller can terminate a contract on the basis of commercial impractica?bility if in?creases in the seller's costs threaten to undercut its profits.

Accepted Answer

A) True 
 B)False

Question 7

Amble Country Stables contracts to buy 1,000 horseshoes from Blacksmith, Inc., for $1 per shoe. When the market price decreases to 50 cents per shoe, Amble refuses to go through with the deal. Blacksmith can recover

Accepted Answer

A)  $1,500. 
B)  $1,000. 
C)  $500. 
D)  0. 
A)  $1,500. 
B)  $1,000. 
C)  $500. 
D)  0.

Question 8

Midstates Utility Corporation contracts with North American Energy Company to buy 50,000 gallons of heating oil. North American agrees to deliver the oil in five equal installments between October 1 and the follow?ing March 15. The winter is the warmest on record, however, and after the last agreed delivery, Midstates has accepted only 30,000 gallons of the oil. When North American tenders the rest of the oil, Midstates refuses to take it, citing the weather and claiming to be acting in good faith. Will North American succeed in a suit against Midstates for breach of contract?

Accepted Answer

Yes, North American will succeed in a su

Question 9

A buyer's breach of a contract will not usually give the seller the right to cancel the contract.

Accepted Answer

A) True 
 B)False

Question 10

If a contract specifies a certain carrier, a substitution of a different carrier for any reason breaches the contract.

Accepted Answer

A) True 
 B)False

Question 11

Colby contracts in writing to sell his 2005 Dodge-brand pick-up truck to Efrem for $10,500. Colby agrees to deliver the truck on Friday, and Efrem promises to pay the $10,500 on the following Monday. On Thursday, Efrem tells Colby that he changed his mind and will not buy the truck. Over the weekend, Efrem changes his mind again and tenders $10,500 to Colby on Monday. Colby has not sold the truck to another party but refuses the tender and refuses to deliver. Efrem claims that Colby has breached their contract. Colby contends that Efrem's repudiation released him from his duty to perform under the contract. Who is correct, and why?

Accepted Answer

Efrem is correct. Colby's refusal to del

Question 12

Delta Boats, Inc., and Eventide Fishing Tours enter into a contract for a sale of seven custom-made swamp boats. Eventide pays for the goods, but Delta does not deliver. Eventide can use replevy as a remedy if

Accepted Answer

A)  Delta is lawfully withholding the goods. 
B)  Eventide cannot effectively cure the defect. 
C)  Eventide is unable to cover for the goods. 
D)  the goods have not been identified to the contract. 
A)  Delta is lawfully withholding the goods. 
B)  Eventide cannot effectively cure the defect. 
C)  Eventide is unable to cover for the goods. 
D)  the goods have not been identified to the contract.

Question 13

Timber Mills Corporation and Ur-Choice Lumberyards enter into a contract for a sale of plywood. Under a destination contract, the seller must

Accepted Answer

A)  allow the buyer to reject the goods for any reason. 
B)  deliver the goods to a particular destination. 
C)  inspect the goods before tendering their delivery. 
D)  place the goods into the hands of a carrier. 
A)  allow the buyer to reject the goods for any reason. 
B)  deliver the goods to a particular destination. 
C)  inspect the goods before tendering their delivery. 
D)  place the goods into the hands of a carrier.

Question 14

Elegant Carpets, Inc., and Fantastic Floors Stores enter into a contract for a sale of carpeting. Under a shipment contract, the seller must

Accepted Answer

A)  allow the buyer to reject the goods for any reason. 
B)  deliver the goods to a particular destination. 
C)  inspect the goods before shipping them. 
D)  place the goods into the hands of a carrier. 
A)  allow the buyer to reject the goods for any reason. 
B)  deliver the goods to a particular destination. 
C)  inspect the goods before shipping them. 
D)  place the goods into the hands of a carrier.

Question 15

International Gem Corporation agrees to sell Jewelry Outlets, Inc. (JOI), fifty new diamonds, but the contract does not specify a place of delivery. JOI is expected to pick up the goods. The place of delivery is

Accepted Answer

A)  International's place of business. 
B)  JOI's place of business. 
C)  the Annual Gems and Jewels Convention. 
D)  the U.S. Postal Service office nearest to JOI's place of business. 
A)  International's place of business. 
B)  JOI's place of business. 
C)  the Annual Gems and Jewels Convention. 
D)  the U.S. Postal Service office nearest to JOI's place of business.

Question 16

The doctrine of commercial impracticability only extends to problems that could have been foreseen.

Accepted Answer

A) True 
 B)False

Question 17

Hi-Tech Company contracts to sell fiber optic cable to Internet Services, Inc. Hi-Tech may bring an action to recover the purchase price and inci?dental damages if Internet

Accepted Answer

A)  accepts the cable and pays for it. 
B)  accepts the cable but does not pay for it. 
C)  rejects the cable. 
D)  revokes acceptance of the cable. 
A)  accepts the cable and pays for it. 
B)  accepts the cable but does not pay for it. 
C)  rejects the cable. 
D)  revokes acceptance of the cable.

Question 18

If a buyer breaches a contract while the seller is still in possession of the goods, the seller can resell the goods and hold the buyer liable for any loss.

Accepted Answer

A) True 
 B)False

Question 19

Fact Pattern 22-B1 
First State Bank issues a letter of credit in favor of Oboe Company, an American firm, to facilitate an international sales contract to buy resources from Lapland Mining, Ltd., a Finnish company.
-Refer to Fact Pattern 22-B1. To obtain payment, Lapland must comply with all of the requirements of the letter of credit

Accepted Answer

A)  strictly. 
B)  substantially. 
C)  reasonably. 
D)  materially. 
A)  strictly. 
B)  substantially. 
C)  reasonably. 
D)  materially.

Question 20

Double D Ranch and Esau enter into a contract on August 1 for the sale of 200 cattle. Esau cancels the con?tract ten days later. Double D is unable to sell the cattle to another buyer. Double D is enti?tled to

Accepted Answer

A)  force Esau to accept the cattle and recover the contract price. 
B)  keep the cattle and recover the contract price from Esau. 
C)  keep the cattle only. 
D)  recover the contract price from Esau but must destroy the cattle. 
A)  force Esau to accept the cattle and recover the contract price. 
B)  keep the cattle and recover the contract price from Esau. 
C)  keep the cattle only. 
D)  recover the contract price from Esau but must destroy the cattle.

Exam 22: Performance Breach of Sales Lease Contracts

In contracts involving a carrier, a seller can complete performance only through a destination contract.

Pep Paints agrees to sell to Quality Painters Grade A-1 latex outdoor paint to be delivered May 8. On May 7, Pep tenders Grade B-2 paint. Quality re?jects the Grade B-2 paint. Two days later, Pep tenders Grade C-3 paint with an offer of a price allowance. Pep has

A buyer may reject a seller's goods only if they fail to conform to a mate?rial term of the contract.

The term cure refers to the right of the seller to reject, adjust, or replace nonconforming goods.

A buyer has no right to accept goods that fail in any respect to conform to the terms of a contract in every detail.

A seller can terminate a contract on the basis of commercial impractica?bility if in?creases in the seller's costs threaten to undercut its profits.

Amble Country Stables contracts to buy 1,000 horseshoes from Blacksmith, Inc., for $1 per shoe. When the market price decreases to 50 cents per shoe, Amble refuses to go through with the deal. Blacksmith can recover

A buyer's breach of a contract will not usually give the seller the right to cancel the contract.

If a contract specifies a certain carrier, a substitution of a different carrier for any reason breaches the contract.

Delta Boats, Inc., and Eventide Fishing Tours enter into a contract for a sale of seven custom-made swamp boats. Eventide pays for the goods, but Delta does not deliver. Eventide can use replevy as a remedy if

Timber Mills Corporation and Ur-Choice Lumberyards enter into a contract for a sale of plywood. Under a destination contract, the seller must

Elegant Carpets, Inc., and Fantastic Floors Stores enter into a contract for a sale of carpeting. Under a shipment contract, the seller must

International Gem Corporation agrees to sell Jewelry Outlets, Inc. (JOI), fifty new diamonds, but the contract does not specify a place of delivery. JOI is expected to pick up the goods. The place of delivery is

The doctrine of commercial impracticability only extends to problems that could have been foreseen.

Hi-Tech Company contracts to sell fiber optic cable to Internet Services, Inc. Hi-Tech may bring an action to recover the purchase price and inci?dental damages if Internet

If a buyer breaches a contract while the seller is still in possession of the goods, the seller can resell the goods and hold the buyer liable for any loss.

Double D Ranch and Esau enter into a contract on August 1 for the sale of 200 cattle. Esau cancels the con?tract ten days later. Double D is unable to sell the cattle to another buyer. Double D is enti?tled to

Introduction to Law and Legal Reasoning

Courts and Alternative Dispute Resolution

Court Procedures

Constitutional Authority to Regulate Business

The Statute of Fraudswriting Requirements

Ethics and Business Decision Making

Intentional Torts

Negligence and Strict Liability

Intellectual Property and Internet Law

Criminal Law and Cyber Crimes

Nature and Terminology

Agreement

Consideration

Capacity and Legality

Mistakes, Fraud, and Voluntary Consent

Third Party Rights

Performance and Discharge

Breach of Contract and Remedies

E-Contracts and E-Signatures

The Formation of Sales and Lease Contracts

Title, Risk, and Insurable Interest

Warranties and Product Liability

The Function Creation of Negotiable Instruments

Transferability and Holder in Due Course

Liability, Defenses, and Discharge

Checks, the Banking System, and E-Money

Creditors Rights and Remedies

Secured Transactions

Bankruptcy Law

Agency Formation and Duties

Liability to Third Parties and Termination

Employment and Labor Law

Employment Discrimination

Sole Proprietorships and Franchises

Partnerships and Limited Liability Partnerships

Limited Liability Companies Special Business Forms

Corporationsformation and Financing

Corporationsdirectors, Officers, Shareholders

Corporationsmerger, Consolidation, Termination

Corporationssecurities Law Corporate Governance

Law for Small Businesses

Administrative Law

Consumer Law

Environmental Law

Antitrust Law

Personal Property and Bailments

Real Property and Landlord-Tenant Relationships

Insurance

Wills and Trusts

Professional Liaility and Accountability

International Law in a Global Economy

Legal and Ethical Issues in Business

Legal Issues

Contracts and Business Law

Contracts and Liability

Banking and Payment Systems

Loan Security and Repossession in Credit Transactions

Employment Law and Ethics

Legal Issues in Corporate Governance and Business Operations

Legal and Ethical Issues in Environmental Protection and Consumer Rights

Legal Issues in Property and Land Use

Accounting and Ethics