Question 1

Talk, Inc., offers to buy from Ultra Corporation 1,000 smartphones. Without notifying Talk, Ultra timely ships phones of a different quality. With respect to the offer and a possible contract, this shipment is an acceptance and

Accepted Answer

A)  ​a breach. 
B)  ​an accommodation. 
C)  ​complete performance. 
D)  ​a counteroffer.

Question 2

Under the UCC, good faith means honesty in fact and the observance of reasonable commercial standards of fair dealing in the trade.

Accepted Answer

A) True 
 B)False

Question 3

Toro, S.A., which is based in Mexico, enters into a contract for the purchase of portable livestock fencing from United Fencing Company, which is based in the United States. This contract is governed by

Accepted Answer

A)  ​Mexican law. 
B)  ​the provisions in the laws of both countries that are similar. 
C)  ​the Uniform Commercial Code. 
D)  ​the United Nations Convention on Contracts for the International Sale of Goods.

Question 4

A court can refuse to enforce a contract that the court deems to have been unconscionable at the time it was made.

Accepted Answer

A) True 
 B)False

Question 5

Refined Grains, Inc., agrees to sell to Sunny Cereal Company a certain quantity of refined oats each week but no mention is made of where the goods are to be delivered. In general, the UCC requires that the delivery take place at

Accepted Answer

A)  a neutral place of business halfway between the parties' locations. 
B)  ​a "reasonable" place of delivery. 
C)  ​Refined's place of business. 
D)  ​Sunny's place of business.

Question 6

Josefina owns a condominium that she leases to Katrina. Josefina gives her daughter Lucia $450 on her sixteenth birthday. Josefina sells her car to her neighbor Maria for $1,500. UCC Article 2 covers

Accepted Answer

A)  ​the lease with Katrina. 
B)  ​the gift to Lucia. 
C)  ​the sale to Maria. 
D)  ​all of the choices.

Question 7

A lessor is a party who acquires a right to the possession and use of goods under a lease.

Accepted Answer

A) True 
 B)False

Question 8

Under the UCC, prompt shipment of goods is considered an acceptance of an offer to buy the goods.

Accepted Answer

A) True 
 B)False

Question 9

In a dispute over a sale involving a bicycle, Dain argues that as to this deal Ed's Hobby Shop, where Dain bought the bike, is a merchant. A court may determine whether Ed's is a merchant by assessing whether

Accepted Answer

A)  ​it has sold any bikes within the last year. 
B)  ​it holds itself out by occupation as having knowledge or skill unique to the bike in the transaction. 
C)  ​its owner enjoys biking. 
D)  ​it subscribes to Bike, a biweekly trade magazine.

Question 10

Containers, Inc., sends its standard order form to Distribution Corporation to evidence a sale of packing materials. Distribution responds with its own standard purchase order form. Additional terms in the purchase order automatically become part of the contract unless

Accepted Answer

A)  ​the terms materially alter the original contract. 
B)  ​the original offer expressly required acceptance of its terms. 
C)  ​the offeror objects to the new terms within a reasonable time. 
D)  ​any of the choices.

Question 11

For an item to be characterized as a "good" under the UCC, it must be intangible.

Accepted Answer

A) True 
 B)False

Question 12

Quinn enters into a series of agreements with Reba involving a sale of a Suite Dreams Motel, including the land, building, furnishings, shares of stock in Suite Dreams Company, and a contract with Trudy to create an ad campaign. Reba suspects that Quinn may be misrepresenting the facts. The UCC Statute of Frauds governs

Accepted Answer

A)  ​the sale of any of the property evidenced by a writing. 
B)  ​the entire deal, including the marketer's services. 
C)  ​the sale of the furnishings priced at $500 or more. 
D)  ​the sale of the land and the building.

Question 13

The terms of a fully integrated contract can be contradicted by evidence of any prior agreements.

Accepted Answer

A) True 
 B)False

Question 14

Curt enters into a contract with Drivers Lease Company for a three-year lease of a car. This contract is subject to

Accepted Answer

A)  ​none of the choices. 
B)  ​Article 2A of the UCC. 
C)  ​Article 11 of the CISG. 
D)  ​the common law only.

Question 15

Goods associated with real estate often fall within the scope of Article 2.

Accepted Answer

A) True 
 B)False

Question 16

Rice River Farms offers to sell Sensei Sushi Restaurants, Inc., five hundred bushels of rice. Sensei responds, "We agree to buy five hundred bushels only if the rice is Grade A quality." This statement is

Accepted Answer

A)  ​a breach. 
B)  ​a counteroffer. 
C)  ​a confirmation. 
D)  ​an acceptance.

Question 17

Fact Pattern 15-1
Farmers Produce, Inc., and Growers Market enter into a contract for the delivery of locally grown fruits and vegetables. The parties use a standard Farmers Produce form that contains some of the terms the parties agree on but not others. Some of the produce spoils before it can be cooked, served, and eaten, or sold. Growers Market refuses to pay for the spoiled goods.
-Refer to Fact Pattern 15-1. Farmers Produce responds that it did not waive payment for spoiled goods in the parties' previous transaction. Farmers Produce is arguing that the court should take into account

Accepted Answer

A)  ​the course of dealing. 
B)  ​the course of performance. 
C)  ​the usage of trade. 
D)  ​none of the choices.

Question 18

Under the UCC, parties to sales and lease contracts are free to establish whatever terms they wish.

Accepted Answer

A) True 
 B)False

Question 19

Stitches Corporation enters into a contract to sell denim clothing to Trend Fashion Company, which in turn sells the clothing to consumers. In contrast to standards that apply to consumers, the UCC imposes on merchants

Accepted Answer

A)  ​less strict legal standards. 
B)  ​special business standards. 
C)  ​stricter ethical standards. 
D)  ​the same overall standards.

Question 20

Under the "partial performance" exception to the UCC, an oral contract for goods worth more than $500 is enforceable if the goods are designed to partially perform a specific function.

Accepted Answer

A) True 
 B)False

Exam 15: The Formation of Sales and Lease Contracts

Talk, Inc., offers to buy from Ultra Corporation 1,000 smartphones. Without notifying Talk, Ultra timely ships phones of a different quality. With respect to the offer and a possible contract, this shipment is an acceptance and

Under the UCC, good faith means honesty in fact and the observance of reasonable commercial standards of fair dealing in the trade.

Toro, S.A., which is based in Mexico, enters into a contract for the purchase of portable livestock fencing from United Fencing Company, which is based in the United States. This contract is governed by

A court can refuse to enforce a contract that the court deems to have been unconscionable at the time it was made.

Refined Grains, Inc., agrees to sell to Sunny Cereal Company a certain quantity of refined oats each week but no mention is made of where the goods are to be delivered. In general, the UCC requires that the delivery take place at

Josefina owns a condominium that she leases to Katrina. Josefina gives her daughter Lucia $450 on her sixteenth birthday. Josefina sells her car to her neighbor Maria for $1,500. UCC Article 2 covers

A lessor is a party who acquires a right to the possession and use of goods under a lease.

Under the UCC, prompt shipment of goods is considered an acceptance of an offer to buy the goods.

In a dispute over a sale involving a bicycle, Dain argues that as to this deal Ed's Hobby Shop, where Dain bought the bike, is a merchant. A court may determine whether Ed's is a merchant by assessing whether

Containers, Inc., sends its standard order form to Distribution Corporation to evidence a sale of packing materials. Distribution responds with its own standard purchase order form. Additional terms in the purchase order automatically become part of the contract unless

For an item to be characterized as a "good" under the UCC, it must be intangible.

The terms of a fully integrated contract can be contradicted by evidence of any prior agreements.

Curt enters into a contract with Drivers Lease Company for a three-year lease of a car. This contract is subject to

Goods associated with real estate often fall within the scope of Article 2.

Rice River Farms offers to sell Sensei Sushi Restaurants, Inc., five hundred bushels of rice. Sensei responds, "We agree to buy five hundred bushels only if the rice is Grade A quality." This statement is

Under the UCC, parties to sales and lease contracts are free to establish whatever terms they wish.

Stitches Corporation enters into a contract to sell denim clothing to Trend Fashion Company, which in turn sells the clothing to consumers. In contrast to standards that apply to consumers, the UCC imposes on merchants

Under the "partial performance" exception to the UCC, an oral contract for goods worth more than $500 is enforceable if the goods are designed to partially perform a specific function.