Question 1

Uri sells 100 cases of vitamins to Wanda, but before she takes physical possession, the cases are lost. Under the UCC, the parties' rights and obligations with respect to the loss depend on the concept of

Accepted Answer

A)   identification.
B)   insurable interest.
C)   risk of loss.
D)   title. C

Question 2

If a sale involves crops that are to be harvested within twelve months, identification takes place when the crops are planted.

Accepted Answer

A) True 
 B)False  True

Question 3

NuStores accepts a shipment of QuikView-brand 3D HD DVD players from Open-Ur-Eyes, Inc. NuStores later discovers a defect in the players, revokes acceptance, and returns the players via Playback, Inc. During the return, the players are lost. The loss is suffered by

Accepted Answer

A)   NuStores.
B)   Playback.
C)   QuikView.
D)   Open-Ur-Eyes. D

Question 4

If a buyer accepts a shipment of goods and later discovers a defect, acceptance can be revoked.

Accepted Answer

A) True 
 B)False

Question 5

Laraby, a representative for Merchandise Shipping Company, delivers a bill of lading to Caitlin, the owner of Dockside Warehouse. A bill of lading is

Accepted Answer

A)   an invoice for payment for loading and carting verified by a seller.
B)   an order to ship goods signed by a buyer.
C)   a receipt for goods signed by a carrier.
D)   a receipt issued by a warehouser for goods in a warehouse.

Question 6

Catchy Gadgets Corporation and Discount Outlets, Inc., enter into a contract for a sale of kitchenware. The contract requires Catchy to deliver the goods to Rapido Carrier Company for transport to Discount's warehouse. Risk of loss passes to Discount when

Accepted Answer

A)   Catchy delivers the goods to Rapido.
B)   Catchy and Discount enter into their contract.
C)   Rapido transports the goods to Discount's warehouse.
D)   Discount sells the goods to its customers.

Question 7

The UCC has replaced the common law concept of title in part with the concept of risk of loss.

Accepted Answer

A) True 
 B)False

Question 8

Finished Furnishings, Inc., agrees to lease an Oak Top-brand desk to Research Resources, Inc. (RRI), which agrees to pick it up at Streetside Warehouse. Before RRI retrieves the desk, it is stolen. The loss is suffered by

Accepted Answer

A)   Perfect Furnishings.
B)   Oak Top.
C)   Streetside Warehouse.
D)   RRI.

Question 9

If a lessor is a merchant, the risk of loss passes to a lessee on the lessee's receipt of the goods.

Accepted Answer

A) True 
 B)False

Question 10

In the following situations, two parties claim the same goods. Who is most likely to prevail in each circumstance Explain.
(a) Olan steals Phil's television set and sells it to Quincy, an innocent purchaser, for value. Phil learns Quincy has the set and demands its return.
(b) Riley takes his television set for repair to Silky, a merchant who sells new and used television sets. By accident, one of Silky's employees sells the set to Tuna, an innocent purchaser-customer, who takes possession. Riley wants his set back from Tuna.

Accepted Answer

The answer of In the following situations, two parties claim...

Question 11

Under the UCC, the risk of los necessarily passes with title.

Accepted Answer

A) True 
 B)False

Question 12

Dragonaire Corporation contracts with Excel Trucking Company to take goods to Fly-By Airlines, Inc., with Fly-By to transport the goods to a Geo Storage Company warehouse. Excel, Fly-By, and Geo each acknowledge possession of the goods by a document of title. Excel, Fly-By, and Geo are

Accepted Answer

A)   bailees.
B)   consignees.
C)   lessees.
D)   sellers.

Question 13

Essen Corporation buys from Fallow Farms, Inc., a rice crop that Fallow plans to plant and harvest during the next growing season. Essen plans to sell the rice to Gourmet Grocery Stores. After the rice is planted, but before it is harvested, an insurable interest in the rice exists in

Accepted Answer

A)   Essen and Fallow, but not Gourmet Grocery.
B)   Essen, Fallow, and Gourmet Grocery.
C)   Essen only.
D)   Fallow only.

Question 14

Matrix Material Corporation in New Jersey sells fifty tons of fabric to Natural Fit Clothing, Inc., in Ohio, "F.O.B. New Jersey." Matrix arranges with Outbound Truckline to transport the goods. The cost of the transport will be paid by

Accepted Answer

A)   Matrix.
B)   Natural Fit.
C)   New Jersey.
D)   Outbound.

Question 15

A seller with voidable title can transfer good title to a good faith purchaser for value.

Accepted Answer

A) True 
 B)False

Question 16

Wild Alaskan sockeye salmon that fill the hold of Dexter's fishing boat are fungible if the fish are

Accepted Answer

A)   alike naturally, by agreement, or by trade usage.
B)   fundamentally different.
C)   fun, good, and edible.
D)   rotting due to a broken freezer in the hold.

Question 17

Harley's Home Store buys furniture from Relax-a-by Furniture, Inc. The parties agree that the furniture will be shipped "F.O.B. Relax-a-by's warehouse" to Harley's via Jiffy Shipping Corporation. The furniture is lost in transit. The loss is suffered by

Accepted Answer

A)   Jiffy Shipping.
B)   Relax-a-by Furniture.
C)   Harley's Home Store.
D)   F.O.B.

Question 18

Suki leaves a Update-brand watch at Timepiece Sales & Repair to be fixed. Timepiece sells the watch to Vera, who does not know that the watch belongs to Suki. Suki can recover from

Accepted Answer

A)   no one.
B)   Timepiece.
C)   Vera.
D)   Update.

Question 19

If the tender or delivery of goods is so nonconforming that the lessee has the right to reject them, the risk of loss remains with the lessor until cure or acceptance.

Accepted Answer

A) True 
 B)False

Question 20

Leasing Equipment Corporation (LEC) agrees to lease five computer workstations to Mapmakers, Inc. Before any interest in the workstations can pass from LEC to Mapmakers, they must be

Accepted Answer

A)   in existence and identified as the goods in the contract.
B)   in LEC's physical possession.
C)   in Mapmakers's physical possession.
D)   listed in a document of title and filed in the appropriate state office.

Exam 20: Title, Risk, and Insurable Interest

Uri sells 100 cases of vitamins to Wanda, but before she takes physical possession, the cases are lost. Under the UCC, the parties' rights and obligations with respect to the loss depend on the concept of

If a sale involves crops that are to be harvested within twelve months, identification takes place when the crops are planted.

NuStores accepts a shipment of QuikView-brand 3D HD DVD players from Open-Ur-Eyes, Inc. NuStores later discovers a defect in the players, revokes acceptance, and returns the players via Playback, Inc. During the return, the players are lost. The loss is suffered by

If a buyer accepts a shipment of goods and later discovers a defect, acceptance can be revoked.

Laraby, a representative for Merchandise Shipping Company, delivers a bill of lading to Caitlin, the owner of Dockside Warehouse. A bill of lading is

Catchy Gadgets Corporation and Discount Outlets, Inc., enter into a contract for a sale of kitchenware. The contract requires Catchy to deliver the goods to Rapido Carrier Company for transport to Discount's warehouse. Risk of loss passes to Discount when

The UCC has replaced the common law concept of title in part with the concept of risk of loss.

Finished Furnishings, Inc., agrees to lease an Oak Top-brand desk to Research Resources, Inc. (RRI) , which agrees to pick it up at Streetside Warehouse. Before RRI retrieves the desk, it is stolen. The loss is suffered by

If a lessor is a merchant, the risk of loss passes to a lessee on the lessee's receipt of the goods.

Under the UCC, the risk of los necessarily passes with title.

Dragonaire Corporation contracts with Excel Trucking Company to take goods to Fly-By Airlines, Inc., with Fly-By to transport the goods to a Geo Storage Company warehouse. Excel, Fly-By, and Geo each acknowledge possession of the goods by a document of title. Excel, Fly-By, and Geo are

Essen Corporation buys from Fallow Farms, Inc., a rice crop that Fallow plans to plant and harvest during the next growing season. Essen plans to sell the rice to Gourmet Grocery Stores. After the rice is planted, but before it is harvested, an insurable interest in the rice exists in

Matrix Material Corporation in New Jersey sells fifty tons of fabric to Natural Fit Clothing, Inc., in Ohio, "F.O.B. New Jersey." Matrix arranges with Outbound Truckline to transport the goods. The cost of the transport will be paid by

A seller with voidable title can transfer good title to a good faith purchaser for value.

Wild Alaskan sockeye salmon that fill the hold of Dexter's fishing boat are fungible if the fish are

Harley's Home Store buys furniture from Relax-a-by Furniture, Inc. The parties agree that the furniture will be shipped "F.O.B. Relax-a-by's warehouse" to Harley's via Jiffy Shipping Corporation. The furniture is lost in transit. The loss is suffered by

Suki leaves a Update-brand watch at Timepiece Sales & Repair to be fixed. Timepiece sells the watch to Vera, who does not know that the watch belongs to Suki. Suki can recover from

If the tender or delivery of goods is so nonconforming that the lessee has the right to reject them, the risk of loss remains with the lessor until cure or acceptance.

Leasing Equipment Corporation (LEC) agrees to lease five computer workstations to Mapmakers, Inc. Before any interest in the workstations can pass from LEC to Mapmakers, they must be