Unit 4 Questions

Brad leaves an iPod at Computer Sales & Repair (CSR) to have the battery replaced. CSR sells the iPod to Doris, who does not know that it belongs to Brad. Brad can recover from a. CSR. b. Doris. c. no one. d. Apple, Inc., the maker of the iPod.

CSR.

Cam enters into a contract with Tractors & Lifts Lease Company for a two-year lease of a backhoe. This contract is subject to a. Article 2 of UCC. b. the common law only. c. Article 2A of the UCC. d. Article 11 of the CISG.

Article 2A of the UCC.

Eliza buys a new motorcycle from Fab Cycles, Inc. The most important factor in determining whether an express warranty is created is whether a. Fab Cycles's promise becomes part of the basis of the bargain. b. Eliza expresses to Fab Cycles what she wants warranted. c. Fab Cycles expresses to Eliza what it expects of its customers. d. Eliza's desire for the cycle becomes part of her motivation to deal.

Fab Cycles's promise becomes part of the basis of the bargain.

Garden & Field stores order a specific assortment of rose bulbs from Hybrid Flora Company. Hybrid mistakenly ships a selection of annuals, which Garden & Field rejects and returns via Intra-state Transport, Inc. During the return, the annuals are lost. The loss is suffered by a. Garden & Field. b. Garden & Field's customers by an increase in prices of other goods. c. Intra-state Transport. d. Hybrid Flora.

Hybrid Flora.

Varoom Motors, Inc., allows Weber to take a Xtrem-brand motorcycle for a "test run." Weber tries the cycle for a few hours, returns, and buys it. This is a. a sale or return. b. a lease. c. a sale on approval. d. a bailment.

a sale on approval.

Medico Inc. enters into a contract to sell medical supplies to New Hospital Corporation, which sells some of the items to Physicians Clinic, which later sells them to Oscar, a patient and consumer. Article 2 of the UCC applies to the sales transactions between a. New Hospital and Physicians Clinic only. b. Physicians Clinic and Oscar only. c. all buyers and sellers. d. Medico and New Hospital only

all buyers and sellers.

TalkTalk, Inc., offers to buy from Voice Media Corporation (VMC) 100,000 smartphones. Without notifying TalkTalk, VMC timely ships phones of a different quality. With respect to the offer and a possible contract, this shipment is a. an acceptance and a breach. b. an acceptance and an accommodation. c. an acceptance and complete performance. d. a rejection and a counteroffer.

an acceptance and a breach.

Blanche, a salesperson for Custom Restaurant Equipment, Inc., shows Dylan, a buyer for Eat n' Dine Company, display items in Custom's showroom, stating that any purchased equipment will match the display. This statement is a. an express warranty. b. a warranty of title. c. puffery. d. an implied warranty.

an express warranty.

Kramer goes to Lawn & Garden to tune up his mower. Martin, the service technician, learns that Kramer's lawn is overgrown and rocky and advises the use of a certain type of oil, plug, filter, and blade. Later, while Kramer is mowing his lawn, the mower breaks down due to the use of the items recommended by Martin. Kramer may recover from Lawn & Garden for breach of a. an implied warranty of fitness for a particular purpose. b. an implied warranty of merchantability. c. a warranty of title. d. an express warranty.

an implied warranty of fitness for a particular purpose.

Motor Coach Corporation, a U.S. firm, orally agrees to sell six vehicles to National Tours, Ltd., a Canadian firm. Motor Coach fails to deliver and National Tours sues to enforce the agreement. Under the CISG, National Tours can prove the terms by a. witnesses only. b. any means. c. a writing, electronic record, or witnesses, but no other means. d. a writing or electronic record only.

any means.

Music, Inc., sells fifty MP3 players to Noise Stores, Inc. To avoid liability for most implied warranties, in some states Music could simply state in writing that the players are sold a. in perfect condition. b. as is. c. with no known defects. d. by a merchant.

as is.

Olga enters into a contract to buy a refrigerator from a Prairie States Appliance store with the price to be paid in monthly installments. After thirty-six months of payments, Olga has paid more than twice the price of a similar stove. Eighteen payments remain due under the contract. Refer to Fact Pattern 16-A1. Under the UCC, the court can evaluate the contract to determine whether it was unreasonably unfair and one sided a. at the time it was made. b. in the middle of its performance. c. at the time of Olga's suit. d. at the end of its term.

at the time it was made.

Good Tire Company and Hiway Auto Service enter into a contract for a sale of tires. Good Tire is a merchant who deals in goods of the kind sold. Under the UCC, an implied warranty of merchantability arises a. automatically in sales contracts. b. only if the seller does not expressly disclaim it. c. only if the buyer asks for it. d. only in conjunction with lease contracts, not sales contracts.

automatically in sales contracts.

Precision Parts, Inc., and Quality Auto stores enter into a contract for a sale of specific auto parts. Precision Parts ships parts that do not meet the specifications. Quality Auto a. must reject the entire shipment. b. must accept the entire shipment. c. cannot reject the entire shipment. d. can reject the entire shipment.

can reject the entire shipment.

Outpost Farm Supply and Pablo enter into a contract for a sale of chicken feed. Circumstances make it difficult for Outpost to perform, and the contract is breached. Pablo looks for remedies. Unlike the common law, under the UCC, remedies are a. exclusive. b. cumulative. c. limited. d. unlimited.

cumulative.

Global Talk Corporation sells phones and other mobile devices. Under most circumstances, Global Talk will be presumed to have warranted that its title to the goods is a. good and valid. b. the same as each brand's name. c. none of the choices—a warranty of title is not presumed. d. the best that money can buy.

good and valid.

Pat's Pet Houses, Inc., sells shelters for animals under "limited" warranties. Under the Magnuson-Moss Warranty Act, this means that the warranties on the shelters from Pat's a. are oral instead of written. b. limit the buyers' recourse in some fashion. c. cover only some of the shelters. d. are only good for some buyers.

limit the buyers' recourse in some fashion.

Hydro Source Company contracts to sell pumps, tanks, and water storage systems to Inflo Irrigation, Inc. Before the goods are delivered, Inflo indicates that it will not be able to pay. Hydro Source can a. force Inflo to accept and pay for the goods. b. resell the goods and recover any damages from Inflo. c. do nothing. d. require Inflo to find a buyer for the goods.

resell the goods and recover any damages from Inflo.

Danko sells new and used sports equipment to persons who come into his store, Eyes on the Prize. One afternoon, Danko sells a used display shelf to Felipe. At a garage sale at his home, Danko sells a used flat-screen TV to Faye. Under the UCC, Danko is a merchant of a. sports equipment, display shelves, and flat-screen TVs. b. sports equipment only. c. sports equipment and display shelves only. d. anything that he chooses to sell.

sports equipment only.

TackMaker, Inc., and Silver Stallion Stables enter into a contract for a sale of bridles, saddlery, and other equine equipment. TackMaker delivers, but Silver Stallion does not pay. TackMaker can normally recover as damages a. the market price at the place at which the seller delivered the goods. b. whatever amount the seller wishes to claim. c. any profit lost minus any loss avoided. d. the purchase price plus incidental damages.

the purchase price plus incidental damages.

Rancho Amarillo and Bulls & Heifers Company enter into a contract for a sale of one hundred head of cattle. When Bulls & Heifers does not deliver within a reasonable time after the agreed on delivery date, Rancho Amarillo files a suit for breach. Bulls & Heifers asserts the doctrine of commercial impracticability. This doctrine extends only to problems that are a. foreseen. b. unforeseeable. c. ordinarily assumed by a seller or lessor. d. preventable.

unforeseeable.

Bert's Bagels & Nosh, Inc., and other bakeries refer to a "baker's dozen" as consisting of a collection of thirteen baked goods. This is an example of a. course of performance. b. course of dealing. c. usage of trade. d. none of the choices.

usage of trade.

Greg, a salesperson for Home Improvement Center, tells Irena, "This is the best floor sander I've ever seen." This statement is a. an implied warranty. b. an express warranty. c. puffery. d. a warranty of title.

puffery.

Arnold buys a backhoe from Big Dig Equipment Inc. Arnold is unaware that Credit Collection Company holds a lien against the backhoe when he buys it. If Credit Collection repossesses the backhoe, Arnold can a. do nothing. b. recover from Big Dig for breach of warranty. c. recover damages from Credit Collection for breach of warranty. d. file criminal charges against Big Dig and Credit Collection

recover from Big Dig for breach of warranty.

River Gear Company and Tours & Trips, Inc., enter into a contract on August 1 for the sale of fifty inflatable river rafts. Tours & Trips cancels the contract ten days later. River Gear is unable to sell the rafts to another buyer. River Gear can a. recover the contract price from Tours & Trips but must hold the rafts for it. b. force Tours & Trips to accept the rafts and pay for them. c. recover the contract price from Tours & Trips and keep the rafts. d. recover the contract price from Tours & Trips but must destroy the rafts.

recover the contract price from Tours & Trips but must hold the rafts for it.

Super Sports stores order sporting goods from Team Supplies, Inc., which ships conforming items via UniWay Delivery Service. Super Sports receives and accepts the goods but fails to pay Team Supplies. Subsequently, Super Sports's warehouse collapses, and the goods are destroyed. The loss is suffered by a. all of the parties as tenants in common. b. Team Supplies. c. Super Sports. d. UniWay Delivery.

Team Supplies

Game Source Stores are open to consumers. The UCC requirement of good faith imposes a. a higher duty on consumers than Game Source. b. a higher duty on Game Source than on consumers. c. no duty on either Game Source or consumers. d. the same duty on Game Source and consumers.

a higher duty on Game Source than on consumers.

Ursula buys a Verismooth boat from a Watercraft store, which agrees to keep the boat for Ursula until she picks it up. Before Ursula gets the boat, an unforeseen tornado destroys the store and the boat. The loss of the boat is suffered by a. Watercraft. b. the government agency that failed to foresee the tornado. c. Ursula. d. Verismooth.

Watercraft.

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 a. a breach. b. a counteroffer. c. a confirmation. d. an acceptance.

a counteroffer.

Mountainside Coffee Company and Nature's Cuisine, Inc., enter into a contract for a sale of coffee beans. The contract includes the term "F.O.B. Ocean City," which is the location of Nature's Cuisine. This means that the contract is a. a bill of lading. b. a shipment contract. c. a destination contract. d. a warehouse receipt.

a destination contract.

Marine Expeditions, Inc., pays Nate's Boats $4,000 to use an oceangoing vessel for a month. For the purposes of the UCC, this is a. a non-taxable event. b. a lease. c. a sale. d. a consignment.

a lease.

Commercial Rents Corporation agrees to lease a pressure washer to Delivery Trucks, Inc., which agrees to pick it up at E Street Warehouse. Before Delivery Trucks retrieves the washer, it is stolen. The loss is suffered by a. E Street Warehouse. b. Delivery Trucks. c. Commercial Rents. d. the thief.

Commercial Rents.

Consumers Choice store accepts a shipment of EZ2U-brand tablets from Digital Devices, Inc. Consumers Choice later discovers a defect in the tablets, revokes acceptance, and returns the tablets via GoBack, Inc. During the return, the tablets are lost. The loss is suffered by a. Digital Devices. b. Consumers Choice's customers by an increase in prices of other goods. c. Consumers Choice. d. GoBack.

Digital Devices.

Mantas Moderno Company, which is based in New York, agrees to sell fifty woven carpets, imported from Mexico and currently stored in New Jersey, to NuDecor, Inc., which is based in Connecticut. If the contract does not indicate where the goods will be delivered, the place of delivery is a. New York. b. Connecticut. c. Mexico. d. New Jersey.

New Jersey.

Red's Roofing buys asphalt roofing tiles from Shingles, Inc. The parties agree that the tile will be shipped "F.O.B. Shingles's warehouse" to Red's Roofing location via Tristate Shipping Corporation. The tiles are lost in transit. The loss is suffered by a. Red's customers by an increase in the prices of goods and services. b. Tristate Shipping. c. Red's Roofing. d. Shingles, Inc.

Red's Roofing.

Refined Cereal Grains, Inc., agrees to sell to Sunny Breakfast 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 a. Refined Cereal's place of business. b. a neutral place of business halfway between the parties' locations. c. a "reasonable" place of delivery. d. Suuny's place of business.

Refined Cereal's place of business.

Spuds Corporation buys from Tater Farms, Inc., a potato crop that Tater plans to plant and harvest during the next growing season. Spuds plans to sell the potatoes to Tasty Foods Restaurants. After the potatoes are planted, but before they are harvested, an insurable interest in the crop exists in a. none of the choices. b. Spuds, Tater, and Tasty Foods. c. Tater only. d. Spuds and Tater, but not Tasty Foods.

Spuds and Tater, but not Tasty Foods.

Safe4U Lenses, Inc., assures ThruVu Optical Company that Safe4U's lenses will not crack within a certain range of pressure. ThruVu buys the lenses to prescribe to its customers. When cracks develop within the stated range, ThruVu files a suit against Safe4U. The court is most likely to rule in favor of a. Safe4U, because ThruVu chose Safe4U's products voluntarily. b. ThruVu, because Safe4U's statement was an express warranty. c. Safe4U, because its statement was an expression of opinion. d. ThruVu, because Safe4U's statement constituted puffery.

ThruVu, because Safe4U's statement was an express warranty.

Quality Metals Company and Superior Fabrication, Inc., enter into a contract under which Quality Metals agrees to deliver a certain quantity of sheet metal to Superior Fabrication each month. The contract does not include a price term. In a suit between the parties over the price, a court will a. impose the highest market price. b. return the parties to the positions they held before the contract. c. impose the lowest market price. d. determine a reasonable price.

determine a reasonable price.

Banquets & Parties (B&P) contracts to buy 1,000 uninflated balloons from Gas Bags, Inc., for $1 per item. When the market price decreases to 50 cents per balloon, B&P refuses to go through with the deal. Gas Bags can resell the goods and recover a. $1,000. b. $0. c. $1,500. d. $500.

$500.

Candy Corporation orders Delicioso-brand chocolate from Edibles Distribution Company. Edibles identifies the goods. Before they are shipped to Candy Corporation, an insurable interest in the goods exists in a. all of the parties as tenants in common. b. Candy Corporation and Edibles Distribution. c. Candy Corporation and Delicioso. d. Delicioso and Edibles Distribution.

Candy Corporation and Edibles Distribution.

Growers Mart buys one hundred cases of berries from Hilltop Farms. The parties agree that the berries will be transported "F.O.B. Hilltop Farms" via Refrigerated Trucking Company. Refrigerated's truck and the berries are lost in a fire following an accident. The loss of the berries is suffered by a. Hilltop Farms. b. Growers Mart. c. Refrigerated Trucking. d. all of the parties as tenants in common in equal measure.

Growers Mart.

Roasters Corporation and Outdoor Barbecue, Inc., enter into a contract for a sale of a commercial grill. The contract requires Roasters to deliver the goods to Speedy Delivery Company for transport to Outdoor. Risk of loss passes to Outdoor when a. Roasters and Outdoor enter into their contract. b. Roasters delivers the goods to Speedy. c. Outdoor begins to use the griill. d. Speedy transports the goods to Outdoor.

Roasters delivers the goods to Speedy.

Safety Supply Corporation in New York sells a truckload of protective suits, masks, and other safety gear to Toxic Recovery, Inc., in Connecticut, "F.O.B. New York." Safety Supply arranges with US Truckline to transport the goods. The cost of the transport will be paid by a. Safety Supply. b. US Truckline. c. Toxic Recovery. d. Toxic Recovery's clients by an increase in the price of loss control services.

Safety Supply.

Refined Mills orders "Grade A" oats from Sweet Valley Farms to grind and sell to Town Co-op Grocery. Sweet Valley ships "Grade B" grain, which Refined Mills accepts. To recover damages for the nonconformity, Refined Mills must give notice of the breach within a reasonable time to a. no one. b. Sweet Valley. c. the appropriate state government agency. d. Town.

Sweet Valley.

Car n' Truck Body & Paint Company orders custom paint from Diverse Hues Inc., but Diverse does not deliver. Car n' Truck will probably be unable to enforce the agreement if the parties omitted a. shipping arrangements. b. a payment term. c. a price term. d. a quantity term.

a quantity term.

Ralph, a representative for Statewide Truck & Transport Company, delivers a warehouse receipt to Thelma, the owner of United Storage Warehouse. A warehouse receipt is a. a receipt for goods signed by a carrier. b. a receipt issued by a warehouser for goods in a warehouse. c. an order to ship goods signed by a buyer. d. an invoice for payment for loading and carting verified by a seller.

a receipt issued by a warehouser for goods in a warehouse.

Daily Bread Bakeries, Inc., contracts to buy all of its ingredient requirements for bread making, at a certain minimum per year, from Enriched Flour & Grain Corporation for six years. After three years, Daily Bread tells Enriched that it plans to sell its assets to Flat Bread Shops, Inc. Flat Bread refuses to assure Enriched that it will continue Daily Bread's contract. Refer to Fact Pattern 18-A1. Flat Bread's refusal is a. a reasonable suspension of performance under the contract. b. a justified response based on Flat Bread's relation to the contract. c. a repudiation of the contract. d. an assignment of Daily Bread's rights under the contract.

a repudiation of the contract.

Paramount Bookstores buys fifty cases of an assortment of books from Quixotic Publishing Company with the right to return the unsold books in lieu of payment. This is a. a sale or return. b. a lease. c. a bailment. d. a sale on approval.

a sale or return.

Katlyn pays Mobile Edge Electronics $500 for a tablet. Under the UCC, this is a. a non-taxable transaction. b. a lease. c. a gift. d. a sale.

a sale.

Business Banners, Inc., and Cam's Auto & Truck Sales Dealership enter into a contract for a sale of thirty advertising banners emblazoned with Cam's logo. The terms do not explicitly or clearly indicate whether it is a destination or shipment contract. A court would normally presume that it is a. a destination contract. b. none of the choices. c. a delivery ex-ship. d. a shipment contract.

a shipment contract.

Corn that fills County Grain Co-op's silo is fungible if the corn is a. alike naturally, by agreement, or by trade usage. b. fun, good, and edible. c. fundamentally different. d. rotting due to a leaky roof and a delay in shipping.

alike naturally, by agreement, or by trade usage.

Canyon Creek Corporation is a Delaware-based firm that does business throughout the United States. With respect to its commercial transactions, Canyon Creek should know that the UCC has been adopted by, and applies in, a. half of the states. b. a few of the states. c. none of the states, to date. d. all of the states, in whole or in part.

all of the states, in whole or in part.

Sigrud buys spiked mountain-climbing shoes from Rockridge Gear store. Rockridge does not know that Sigrud plans to wear the shoes to climb Tower Mountain. When Sigrud is on the mountain, the spikes come out of the shoes, causing her to fall and be injured. Rockridge breached a. an express warranty. b. an implied warranty of merchantability. c. none of the choices. d. an implied warranty of fitness for a particular purpose.

an implied warranty of fitness for a particular purpose.

Equipment Rents Company and Road Builders, Inc., enter into a contract for a lease of excavators. Equipment Rents is a merchant who deals in goods of the kind leased. Under the UCC, an implied warranty of merchantability arises a. automatically in lease contracts. b. only if the lessee asks for it. c. only in conjunction with sales contracts, not lease contracts. d. only if the lessor does not expressly disclaim it.

automatically in lease contracts.

Vehicle Wholesale Company and Walt's Retail Motors enter into a contract for a sale of used cars. Vehicle Wholesale assures Walt's that it has valid title to the vehicles. Under the UCC, warranties of title arise a. only if the buyer asks for such a warranty. b. only in conjunction with lease contracts, not sales contracts. c. only if the seller expresses such a warranty. d. automatically in most sales contracts.

automatically in most sales contracts.

Home Appliance Corporation contracts with Instate Trucking Company to take a selection of appliance repair parts to Journey Airlines, Inc., with Journey to transport the goods to a KeepSafe Company warehouse. Instate Trucking, Journey Airlines, and KeepSafe each acknowledge possession of the goods by a document of title. Instate Trucking, Journey Airlines, and KeepSafe are a. lessees. b. buyers. c. bailees. d. sellers.

bailees.

Sugar & Spice, Inc., and Taste Treats stores enter into a contract for a sale of confections. Sugar & Spice, a merchant who deals in goods of the kind sold, makes express warranties in connection with the sale. Under the UCC, at the time a contract is formed, an express warranty can be disclaimed or modified a. in no way. b. in any way that the seller sees fit for the ordinary purpose. c. by clear, conspicuous language called to the buyer's attention. d. by implied affirmations of fact relating to the goods.

by clear, conspicuous language called to the buyer's attention.

Precise Engineering, P.C., is a California-based firm that does business with clients throughout North America. Precise Engineering plans and executes construction projects, and buys and sells developed and undeveloped land, and related equipment and supplies. Precise Engineering has had to confront work-site theft and vandalism. With respect to these circumstances, the Uniform Commercial Code (UCC) provides a framework for a. international construction contracts. b. commercial transactions for the sale of and payment for goods. c. domestic and foreign transactions in real estate. d. prosecuting crimes against business interests.

commercial transactions for the sale of and payment for goods.

Commercial Leasing Corporation and Quarry Construction Company enter into a contract for a lease of three excavators. Under the perfect tender rule, Commercial Leasing must ship or tender goods to the lessee that a. substantially conform to the contract description. b. approximately conform to the contract description. c. entirely conform to the contract description in most ways. d. conform to the contract description in every way.

conform to the contract description in every way.

Home Remodelers, Inc., and Imogen enter into a contract for a sale of cabinets and countertops. Home Remodelers, a merchant who deals in goods of the kind sold, notes that its goods come with an implied warranty of merchantability. Under the UCC, this means that the goods are reasonably a. fit for the ordinary purpose for which such goods are used. b. suitable for resale at an acceptable price. c. fit for the buyer's particular purpose. d. the best quality that money can buy.

fit for the ordinary purpose for which such goods are used.

Cameron buys a motorcycle from Blammo Motors. Cameron soon discovers that the cycle has a defect that significantly affects its value and use. To sue Blammo under the UCC, Cameron must commence an action for breach of contract within a. one year. b. two years. c. four years. d. three years.

four years.

HandiTools, Inc., sells power tools, power tool parts, and related supplies under "full" warranties. Under the Magnuson-Moss Warranty Act, this means that HandiTools must provide a. repair or replacement of any defective part at a reduced charge. b. a toll-free number for a HandiTools-approved service company. c. free repair or replacement of any defective part. d. a complete catalog of products and parts available for sale.

free repair or replacement of any defective part.

Gold Medical Supply Company and Home & Hospice Care, Inc., enter into a contract for a sale of health care equipment and supplies. Under either a shipment contract or a destination contract, the seller must a. deliver the goods to a particular destination. b. allow the buyer to reject the goods for any reason. c. give the buyer any necessary documents of title. d. place the goods into the hands of a carrier.

give the buyer any necessary documents of title.

Construction Products Company and Dante enter into a contract for a sale of bricks and stones. Construction Products knows the purpose for which Dante will use the goods. Under the UCC, an implied warranty of fitness of a particular purpose arises a. if the buyer asks for it. b. in conjunction with lease contracts, not sales contracts. c. if the seller is a merchant who deals in goods of the kind sold. d. if the buyer is relying on the seller to select suitable goods.

if the buyer is relying on the seller to select suitable goods.

Equipment Rentals Corporation (ERC) agrees to lease two backhoes to Dig & Fill Construction, Inc. Before any interest in the backhoes can pass from ERC to Dig & Fill, they must be a. in Dig & Fill's physical possession. b. in existence and identified as the goods in the contract. c. in ERC's physical possession. d. listed in a document of title and filed in the appropriate state office.

in existence and identified as the goods in the contract.

In a dispute over a sale involving a restored 1937 Ford Roadster, Garth argues that for the purpose of the sale, Hoyt's Pawn Shop, where Garth bought the auto, is a merchant. A court may determine whether Hoyt's is a merchant by assessing whether a. its owner enjoys motoring. b. it has sold any restored autos within the last year. c. it holds itself out by occupation as having knowledge or skill unique to the auto in the transaction. d. it subscribes to Restoration, a biweekly trade magazine.

it holds itself out by occupation as having knowledge or skill unique to the auto in the transaction.

Lighter Than Air, Inc., and Mario enter into a contract for a sale of a hang glider. Lighter Than Air, a merchant who deals in goods of the kind sold, makes implied and express warranties in connection with the sale. The Magnuson-Moss Warranty Act was designed to prevent deception in warranties by a. displacing the UCC as the primary source of warranty rules. b. making warranties easier to understand. c. requiring sellers to give written warranties for consumer goods. d. prohibiting disclaimers of warranties.

making warranties easier to understand.

Coffee Roasters, Inc., sells whole bean and ground coffee to Delicioso Deli under an existing contract. When the cost of coffee beans increases, Delicioso agrees to modifying the contract to increase the price, but later wants to cancel the contract. Delicioso may a. cancel the contract immediately. b. not cancel the contract. c. cancel the contract only on reasonable notice. d. cancel the contract only after accepting a final shipment.

not cancel the contract.

Farmland Creamery enters into a contract for the sale of dairy products to Gourmet Delis, Inc. When Farmland learns that Gourmet is insolvent, Farmland can stop delivery of the goods in transit a. only if the quantity is at least a planeload. b. only if the quantity is at least a truckload. c. only if the quantity is at least a carload. d. regardless of the quantity.

regardless of the quantity.

Ocean Vessels, Inc., and Pacific Harbor Company enter into a contract for a sale of a boat. Ocean is a merchant who deals in goods of the kind sold. The goods are defective. Under the UCC, the implied warranty of merchantability is breached a. only if Ocean knew about or could have discovered the defect. b. only if Ocean did not know about the defect. c. only if Ocean did not know about and could not have discovered the defect. d. regardless of what Ocean knew or could have discovered.

regardless of what Ocean knew or could have discovered.

Asian Noodle Company contracts to sell 1,000 cases of rice noodles to Bob's Bistros, Inc., but later refuses to deliver. Due to a rice shortage, Bob's Bistros cannot obtain the noodles elsewhere. The buyer's right to recover the goods from the seller is the right of a. cover. b. replevin. c. cure. d. specific performance.

replevin.

Fruit of the Plant, Inc., agrees to sell a certain quantity of a high-quality grain seed to Grange Co-op. Fruit of the Plant can obtain only half of the quantity ordered, so the seller also ships a lesser quality seed in twice the amount of the remainder of the order for the same price. Grange Co-op rejects the lesser quality seed. With time for performance not yet expired, Fruit of the Plant can a. resell or dispose of the goods and hold Grange Co-op liable for any loss. b. attempt to cure the defect. c. recover the purchase price plus incidental damages. d. cancel the contract.

resell or dispose of the goods and hold Grange Co-op liable for any loss.

Daily Bread Bakeries, Inc., contracts to buy all of its ingredient requirements for bread making, at a certain minimum per year, from Enriched Flour & Grain Corporation for six years. After three years, Daily Bread tells Enriched that it plans to sell its assets to Flat Bread Shops, Inc. Flat Bread refuses to assure Enriched that it will continue Daily Bread's contract. Refer to Fact Pattern 18-A1. Enriched can a. terminate the contract and seek damages. b. suspend performance under the contract until Enriched is fully paid. c. assign its rights under the contract but cannot terminate it. d. do nothing.

terminate the contract and seek damages.

Drink Dispensers, Inc., contracts for the sale of soda vending machines to Evan's Quik Stop stores. Drink Dispensers repudiates the contract. Evan's recovery of damages is measured at the time a. the seller knew that it would repudiate the contract. b. the seller advertised the goods. c. the buyer ordered the goods. d. the buyer learned of the breach.

the buyer learned of the breach.

Precious Stones, Inc., and Sparkling Jewelry stores enter into a contract for a sale of gemstones. Precious Stones does not deliver. The buyer can normally recover as damages the difference between a. the contract price and the market price. b. the current prices in the parties' locations. c. any loss avoided and any profit gained. d. the actual price and the hoped-for price.

the contract price and the market price.

Olga enters into a contract to buy a refrigerator from a Prairie States Appliance store with the price to be paid in monthly installments. After thirty-six months of payments, Olga has paid more than twice the price of a similar stove. Eighteen payments remain due under the contract. Refer to Fact Pattern 16-A1. Olga files a suit against Prairie States, claiming that their contract is so unfair and one sided that it would be unreasonable to enforce it. Olga is asserting a. the concept of good faith. b. the principle of fair trade. c. the doctrine of unconscionability. d. the predominant-factor test.

the doctrine of unconscionability.

Rollo enters into a series of agreements with Sigrud involving a sale of a Tito's Tacos restaurant, including the land, building, furnishings, shares of stock in Tito's Tacos Company, and a contract with Travis to create an ad campaign. Sigrud suspects that Rollo may be misrepresenting the facts. The UCC Statute of Frauds governs the sale of a. any of the property evidenced by a writing. b. any of the property that may involve fraud. c. the land and the building. d. the furnishings priced at $500 or more.

the furnishings priced at $500 or more.

Over the course of a year, Discount Market Company sells goods from its inventory and also sells one of its warehouses. In exchange, Discount receives checks, which Discount uses to repay a loan from Evermore Credit Inc. Article 2 of the UCC governs a. the payment of the loan. b. the sale of the buildings. c. the sale of the goods. d. the checks.

the sale of the goods.

Banquet Furnishings, Inc., and Christina enter into a contract for a lease of tables, chairs, and items for a wedding reception. Banquet Furnishings, a merchant who deals in goods of the kind sold, generally describes the goods, details technical specifications, and shows a sample. Under the UCC, if these are inconsistent a. the general description displaces the technical specifications. b. the general description displaces the sample. c. the sample takes precedence over the technical specifications. d. the sample takes precedence over the general description.

the sample takes precedence over the general description.