Question 1

Sweet Tooth Pastries,Inc.,and other bakers refer to a "baker's dozen" as con?sisting of a collection of thirteen baked goods.This is an example of

Accepted Answer

This is an example of usage of trade, which is a common practice or custom within a certain industry or community. In the baking industry, it is customary to refer to a baker's dozen as consisting of 13 baked goods.

Question 2

Omni Corporation is a Pennsylvania-based firm that does business throughout the United States.With respect to this circumstance,the UCC has been adopted by,and applies in,

Accepted Answer

The UCC (Uniform Commercial Code) has been adopted by and applies in all of the states in whole or in part. Therefore, it applies to Omni Corporation regardless of which states they do business in.

Question 3

Fresh Harvest,Inc.,agrees to sell to Gina's Bed & Breakfast Inn a certain amount of locally grown produce 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

Under the UCC, if no delivery location is specified, the default is the seller's place of business.

Question 4

Pressing Music,Inc.,offers to buy from Digital Media Corporation (DMC)one million blank CDs of a certain quality.Without notifying Pressing,DMC timely ships CDs of a different quality.With respect to the offer and a possible contract,this shipment is

Accepted Answer

The shipment of CDs of a different quality without notifying Pressing is an acceptance of the offer, as DMC is indicating its willingness to perform the contract. However, it is also a breach because DMC is not fulfilling the terms of the offer by delivering a different quality product.

Question 5

Trina pays Urban Edge Electronics store $1,500 for a laptop com?puter.Under the UCC,this is

Accepted Answer

Trina paying $1,500 to Urban Edge Electronics store for a laptop computer is a clear example of a sale under the UCC (Uniform Commercial Code). A sale is defined as the passing of title from the seller to the buyer for a price.

Question 6

Rio Engineering Corporation pays PC Technologies,Inc.,$1,000 to use a com?puter for a month.For purposes of the UCC,this is

Accepted Answer

The transaction between Rio Engineering Corporation and PC Technologies, Inc. is a lease, as it involves the temporary use of a computer for a specific period in exchange for a payment. This falls under the definition of a lease as defined by the Uniform Commercial Code (UCC). Therefore, options A, B, and D are not applicable in this scenario.

Question 7

Pop Culture Clothiers,Inc.,sells t-shirts to Trendwell Stores,Inc.,under an existing con?tract.When textile costs increase,Trendwell agrees to a price increase,but later wants to cancel the con?tract.Trendwell may

Accepted Answer

The answer of Pop Culture Clothiers,Inc.,sells t-shirts to Trendwell Stores,Inc.,under...

Question 8

Curtis enters into a contract with Drive-Away Lease Company for a three-year lease of a car.This contract is subject to

Accepted Answer

Article 2A of the UCC governs leases of personal property, which includes vehicles leased for personal use. Therefore, the contract between Curtis and Drive-Away Lease Company for the three-year lease of a car would be subject to Article 2A of the UCC.

Question 9

Five Star Flooring orders carpet from Textile Mills Corporation,but Textile does not deliver.Five Star will probably be unable to enforce the agreement if the parties omitted

Accepted Answer

If the parties did not include a quantity term in their agreement, it is unclear how much carpet Textile Mills Corporation was supposed to deliver to Five Star Flooring. Without this key term, it would be difficult for Five Star Flooring to enforce the agreement. The other options, while important, are not as critical to the overall enforceability of the agreement.

Question 10

Overseas Corporation (OC),a U.S.firm,orally agrees to sell six freezers to Pisa Pizza,Ltd.,in Italy.OC fails to deliver.Under the CISG,Pisa Pizza can

Accepted Answer

The CISG, which is applicable to contracts for the sale of goods between parties from different countries, does not require that contracts be in writing. The fact that the agreement was made orally does not prevent Pisa Pizza from enforcing the agreement. Additionally, the CISG provides that where the contract does not specify the price, the parties will be deemed to have agreed on a price that is reasonable at the time of the conclusion of the contract. As such, the lack of a specific price term does not prevent Pisa Pizza from enforcing the agreement. Finally, consideration is assumed to exist in contracts under the CISG, and so the absence of consideration is not a valid reason for Pisa Pizza to be unable to enforce the agreement. Therefore, Pisa Pizza can enforce the oral agreement for the sale of the freezers.

Question 11

Fact Pattern 19-A1 (Questions A18-A19 apply)
Olisa enters into a contract to buy a stove from Pay-to-Own Appliance store with the price to be paid in monthly installments.After thirty-six months of payments,Olisa has paid more than twice the price of a similar stove.Eighteen payments remain due under the contract.
-Refer to Fact Pattern 19-A1.Under the UCC,the court can evaluate the contract to determine whether it was unreasonably unfair and one sided

Accepted Answer

The UCC allows the court to evaluate a contract at the time it was made to determine if it was unreasonably unfair and one-sided.

Question 12

Cleo sells kitchen appliances to per?sons who come into her store,Buy n' Sell Appliances.One afternoon,Cleo sells a used display shelf to Earline.At a garage sale at her home,Cleo sells a used sofa to Flavia.Under the UCC,Cleo is a merchant of

Accepted Answer

Under the UCC, a merchant is someone who deals in goods of the kind or otherwise holds themselves out as having special knowledge or skill related to the goods involved in the transaction. Cleo is a merchant of kitchen appliances because she sells them in her store, but not of display shelves or sofas, as these are not her regular business.

Question 13

Valley Farms offers to sell Whole Harvest Bakeries,Inc.,five hundred bushels of wheat.Whole Harvest responds,"We agree to buy five hundred bushels only if the wheat is Grade A quality." This statement is

Accepted Answer

Whole Harvest's response does not accept or reject the offer, but rather proposes a new condition. This is known as a counteroffer, and it has the effect of rejecting the original offer.

Question 14

Bild-Rite,Inc.,is a Colorado-based firm that does business with clients throughout North America.Bild-Rite oversees construction projects,and buys and sells commercial buildings,undeveloped land,and construction supplies and other goods.Bild-Rite has had to deal with work-site theft and vandalism.With respect to these circumstances,the Uniform Commercial Code (UCC)provides a framework for

Accepted Answer

The UCC provides guidelines and regulations for the sale of goods and the payment for those goods, which would include construction supplies and other materials purchased by Bild-Rite. The UCC does not address international contracts, real estate transactions, or prosecution of crimes.

Question 15

Over the course of a year,Retail Market,Inc.,sells goods from its inventory and one of its warehouses.In exchange,Retail receives checks and other items that substitute for cash,which Retail uses to repay a loan from Savers Bank.Article 2 of the UCC governs

Accepted Answer

Article 2 of the UCC governs the sale of goods. In this scenario, Retail Market, Inc. sells goods from its inventory and warehouse, and the payments it receives in exchange are likely for those sales. Therefore, Article 2 of the UCC applies. The checks and other items that substitute for cash are simply the form of payment for the sale of goods, making them encompassed by the provisions of Article 2 as well. The loan from Savers Bank is unrelated to the sale of goods and is therefore not governed by Article 2. The sale of the buildings is not relevant to this scenario, as the question only concerns Retail's sale of goods and receipt of payment.

Question 16

Fact Pattern 19-A1 (Questions A18-A19 apply)
Olisa enters into a contract to buy a stove from Pay-to-Own Appliance store with the price to be paid in monthly installments.After thirty-six months of payments,Olisa has paid more than twice the price of a similar stove.Eighteen payments remain due under the contract.
-Refer to Fact Pattern 19-A1.Olisa files a suit against Pay-to-Own,claiming that their contract is so unfair and one sided that it would be unreasonable to enforce it.Olisa is asserting

Accepted Answer

Olisa is asserting the doctrine of unconscionability, which allows a court to refuse to enforce a contract that is so one-sided and unfair that it shocks the conscience of the court. Paying more than twice the price of a similar stove is an example of this type of unfair and unreasonable contract.

Question 17

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

Accepted Answer

Under the Uniform Commercial Code (UCC), a merchant is defined as a person who deals in goods of the kind or holds themselves out by occupation as having knowledge or skill unique to the goods involved in the transaction. Therefore, if Emory's Hobby Shop holds itself out as having knowledge or skill in bicycles, then it would be considered a merchant. The other choices are irrelevant to determining whether Emory's is a merchant or not.

Question 18

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 the sale of

Accepted Answer

The UCC Statute of Frauds applies to the sale of goods priced at $500 or more, which would include the furnishings. The sale of land and buildings is governed by common law, not the UCC.

Question 19

Rally Corporation enters into a contract to sell ski gear to SnoSportz Company,which sells a pair of the skis to Tyra,a consumer,who later sells them to Uli,another consumer.Article 2 of the UCC applies to the sales transactions between

Accepted Answer

Article 2 of the UCC applies to transactions involving the sale of goods, which includes all the sales transactions between Rally, SnoSportz, Tyra, and Uli, as they all involve the sale of ski gear, which is considered goods.

Question 20

Sunny Glass Company and Collision Repair Center enter into a contract under which Sunny agrees to deliver a certain quantity of auto glass to Collision Repair each month.The contract does not include a price term.In a suit between the par?ties over the price,a court will

Accepted Answer

In the absence of a price term, the court will look to determine a reasonable price based on the circumstances surrounding the contract. This could include factors such as past dealings between the parties, industry standards, and other relevant factors. Imposing the lowest or highest market price would not be appropriate without evidence of what the market rate is for the specific goods in question. Returning the parties to their pre-contract positions would not resolve the issue of determining a price.

Quiz 19: The Formation of Sales and Lease Contracts