Question 1

The written confirmation rule requires that both parties to an oral agreement send written confirmation of the sale or lease.

Accepted Answer

A) True 
 B)False

Question 2

The formation of sales and lease contracts requires consideration.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following would be considered goods?

Accepted Answer

A)  company shares 
B)  crops 
C)  trade secrets 
D)  money 
A)  company shares 
B)  crops 
C)  trade secrets 
D)  money

Question 4

Which of the following does Article 2A of the Uniform Commercial Code govern?

Accepted Answer

A)  mixed sales 
B)  sale of goods 
C)  leases 
D)  letters of credit 
A)  mixed sales 
B)  sale of goods 
C)  leases 
D)  letters of credit

Question 5

In a lease contract, the title of goods is passed from the lessor to the lessee.

Accepted Answer

A) True 
 B)False

Question 6

The ________ states that a merchant who offers to buy, sell, or lease goods and gives a written and signed assurance on a separate form that the offer will be held open cannot revoke the offer for the time stated or, if no time is stated, for a reasonable time.

Accepted Answer

A)  gap-filling rule 
B)  firm offer rule 
C)  mirror image rule 
D)  open term rule 
A)  gap-filling rule 
B)  firm offer rule 
C)  mirror image rule 
D)  open term rule

Question 7

A person who transfers the right of possession and use of goods under a lease is known as the ________.

Accepted Answer

A)  lessor 
B)  lessee 
C)  seller 
D)  consignee 
A)  lessor 
B)  lessee 
C)  seller 
D)  consignee

Question 8

Sales that contain provisions of services and goods in the same transaction are not covered by Article 2 of the UCC.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following is true for goods under the purview of Article 2 of the Uniform Commercial Code?

Accepted Answer

A)  Goods can be replaced by money. 
B)  Intangible goods must be exchanged for other intangible goods. 
C)  Goods in the contract must be movable. 
D)  Immovable goods like real estate must have provisions of service attached to their contracts. 
A)  Goods can be replaced by money. 
B)  Intangible goods must be exchanged for other intangible goods. 
C)  Goods in the contract must be movable. 
D)  Immovable goods like real estate must have provisions of service attached to their contracts.

Question 10

Under common law's mirror image rule, an offeree's acceptance must be on the same terms as the offer.

Accepted Answer

A) True 
 B)False

Question 11

How are additional terms in an acceptance to a contract viewed under the common law?

Accepted Answer

A)  They are viewed as proposed additions to the contract. 
B)  They are seen as a counteroffer. 
C)  They are allowed into the contract by the battle of the forms rule. 
D)  They must be accepted under the mirror image rule. 
A)  They are viewed as proposed additions to the contract. 
B)  They are seen as a counteroffer. 
C)  They are allowed into the contract by the battle of the forms rule. 
D)  They must be accepted under the mirror image rule.

Question 12

The UCC does not allow for open terms to be read into a sales or lease contract.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following articles in the UCC deals with the sale of goods?

Accepted Answer

A)  Article 2 
B)  Article 4 
C)  Article 5 
D)  Article 8 
A)  Article 2 
B)  Article 4 
C)  Article 5 
D)  Article 8

Question 14

Stelwire LLC, a vintage car dealer, advertises the sale of a 1964 Ford Thunderbolt. Ralph responds to the advertisement with an offer of $80,000 for the car. Stelwire signs a written assurance to keep that offer open to Ralph for a fortnight. Five days before the fortnight is up, Stelwire sells the car to another buyer. At the end of the fortnight period, Ralph tenders $80,000 for the car, but the car has already been sold. Ralph then buys the same model car from another dealer for $90,000 and sues Stelwire for breach of contract. The court rules that Stelwire is liable to Ralph for breach of contract and orders Stelwire to pay Ralph the difference of $10,000 he paid extra to the second dealer for the car. Which of the following rules governs the execution of this contract?

Accepted Answer

A)  firm offer rule 
B)  mirror image rule 
C)  battle of the forms rule 
D)  gap-filling rule 
A)  firm offer rule 
B)  mirror image rule 
C)  battle of the forms rule 
D)  gap-filling rule

Question 15

What is "course of dealing" when interpreting the express terms of a written statement?

Accepted Answer

A)  the previous conduct of the parties regarding the contract in question 
B)  the conduct of the parties in prior transactions and contracts 
C)  the conduct of contractual parties with parties not involved in the contract 
D)  any practice of dealing that is regularly observed or adhered to in an industry 
A)  the previous conduct of the parties regarding the contract in question 
B)  the conduct of the parties in prior transactions and contracts 
C)  the conduct of contractual parties with parties not involved in the contract 
D)  any practice of dealing that is regularly observed or adhered to in an industry

Question 16

A ________ is defined as the passing of title of goods from a seller to a buyer for a price.

Accepted Answer

A)  lease 
B)  sale 
C)  loan 
D)  gift 
A)  lease 
B)  sale 
C)  loan 
D)  gift

Question 17

Option contracts are examples of irrevocable offers.

Accepted Answer

A) True 
 B)False

Question 18

Under the Uniform Commercial Code, if the time, place, and manner of delivery of goods are not mentioned in a contract, ________.

Accepted Answer

A)  the place of delivery is the buyer's place of business 
B)  the contract is void for lack of definiteness 
C)  the place of delivery is the seller's place of business 
D)  the seller is obligated to pay for shipping to the buyer's place of business 
A)  the place of delivery is the buyer's place of business 
B)  the contract is void for lack of definiteness 
C)  the place of delivery is the seller's place of business 
D)  the seller is obligated to pay for shipping to the buyer's place of business

Question 19

When do additional terms contained in an acceptance become part of the contract as per the battle of the forms rule?

Accepted Answer

A)  if the additional terms materially alter the original contract 
B)  if the sale is between two nonmerchants 
C)  if the additional terms expressly limit the acceptance to the terms of the offer 
D)  if the offeror notifies the offeree that he or she does not object to the additional terms 
A)  if the additional terms materially alter the original contract 
B)  if the sale is between two nonmerchants 
C)  if the additional terms expressly limit the acceptance to the terms of the offer 
D)  if the offeror notifies the offeree that he or she does not object to the additional terms

Question 20

How are contracts for the provision of services treated under Article 2 of the Uniform Commercial Code?

Accepted Answer

Contracts for the provision of services-

Exam 18: Formation of Sales and Lease Contracts

The written confirmation rule requires that both parties to an oral agreement send written confirmation of the sale or lease.

The formation of sales and lease contracts requires consideration.

Which of the following would be considered goods?

Which of the following does Article 2A of the Uniform Commercial Code govern?

In a lease contract, the title of goods is passed from the lessor to the lessee.

The ________ states that a merchant who offers to buy, sell, or lease goods and gives a written and signed assurance on a separate form that the offer will be held open cannot revoke the offer for the time stated or, if no time is stated, for a reasonable time.

A person who transfers the right of possession and use of goods under a lease is known as the ________.

Sales that contain provisions of services and goods in the same transaction are not covered by Article 2 of the UCC.

Which of the following is true for goods under the purview of Article 2 of the Uniform Commercial Code?

Under common law's mirror image rule, an offeree's acceptance must be on the same terms as the offer.

How are additional terms in an acceptance to a contract viewed under the common law?

The UCC does not allow for open terms to be read into a sales or lease contract.

Which of the following articles in the UCC deals with the sale of goods?

What is "course of dealing" when interpreting the express terms of a written statement?

A ________ is defined as the passing of title of goods from a seller to a buyer for a price.

Option contracts are examples of irrevocable offers.

Under the Uniform Commercial Code, if the time, place, and manner of delivery of goods are not mentioned in a contract, ________.

When do additional terms contained in an acceptance become part of the contract as per the battle of the forms rule?

How are contracts for the provision of services treated under Article 2 of the Uniform Commercial Code?

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