Question 1

Fuel Connector Products, Inc., agrees to sell Go-Flo, Inc., a certain quantity of parts located at Fuel Connector's place of business, but the contract does not specify a place of delivery. Go-Flo is expected to pick up the goods. The place of delivery is

Accepted Answer

In the absence of a specified place of delivery in the contract, the default rule is that the place of delivery is the seller's place of business, which in this case is Fuel Connector's place of business.

Question 2

Elegant Carpets, Inc., and Fantastic Floors Stores enter into a contract for a sale of carpeting. Under a shipment contract, the seller must

Accepted Answer

Under a shipment contract, the seller's responsibility is to place the goods into the hands of a carrier. The carrier then assumes responsibility for delivery of the goods to the buyer. The buyer does not have the right to reject the goods for any reason, and the seller is not required to deliver the goods to a particular destination or inspect the goods before shipping them.

Question 3

Paper Company, Inc. agrees to supply Payroll Express with thirty reams of paper each month. Paper Company cannot reasonably ask Payroll Express to pick up the paper at

Accepted Answer

4:30 A.M. is an unreasonable time for a business to pick up supplies, as it is outside of normal business hours.

Question 4

Dairy Goods agrees to sell a certain quantity of ice cream to Event Caterers, but their contract does not specify the address at which the goods are to be delivered. The place of delivery is

Accepted Answer

In the absence of a specified delivery location in a contract, the default rule under the Uniform Commercial Code (UCC) is that the place of delivery is the seller's place of business.

Question 5

When a buyer recovers damages for a seller's breach, the correct calculation is the difference between the contract amount and the market value of the goods at the location of the delivery at the time the buyer learned of the breach.

Accepted Answer

The correct measure of damages for a seller's breach is typically the difference between the contract price and the market price at the time and place of delivery, as per the Uniform Commercial Code (UCC) guidelines.

Question 6

To effectively revoke acceptance, a buyer must return the goods within 30 days of the revocation.

Accepted Answer

The Uniform Commercial Code (UCC) does not specify a 30-day period for returning goods after revocation of acceptance. The buyer must notify the seller of the revocation within a reasonable time after discovering the defect.

Question 7

If a seller or lessor fails to deliver the goods, the buyer or lessee can sue for damages.

Accepted Answer

Under the Uniform Commercial Code (UCC), if a seller or lessor fails to deliver goods as agreed, the buyer or lessee has the right to sue for damages.

Question 8

Clear View Company, which is based in Delaware, agrees to sell fifty windows, identified as currently being stored in Florida, to Fair Sight, Inc., which is based in Hawaii. Absent an agreement to the contrary, the place of delivery is in

Accepted Answer

The place of delivery is typically where the goods are located at the time of the sale, which in this case is Florida, where the windows are stored.

Question 9

Anticipatory repudiation occurs when the parties-at the time the contract was made-had reason to anticipate a certain event.

Accepted Answer

Anticipatory repudiation occurs when one party indicates they will not perform their contractual obligations before the performance is due, not based on events anticipated at the time the contract was made.

Question 10

If either the goods or their tender of the goods by the seller or lessor fails to conform to the contract in any respect, the buyer or lessee normally can reject the goods.

Accepted Answer

Under the Uniform Commercial Code (UCC), if goods or their tender fail to conform to the contract in any respect, the buyer or lessee has the right to reject them.

Question 11

Buyers and lessees who have rightfully rejected goods or revoked acceptance can protect themselves by exercising the right to cure.

Accepted Answer

The right to cure is a remedy available to sellers, not buyers or lessees, allowing them to correct a delivery of non-conforming goods within the contract period.

Question 12

If a buyer or lessee wrongfully refuses to accept the goods, the seller or lessor can only demand return of the goods and is not able to bring an action for damages.

Accepted Answer

Under the Uniform Commercial Code (UCC), if a buyer or lessee wrongfully refuses to accept goods, the seller or lessor can seek damages for non-acceptance in addition to reclaiming the goods.

Question 13

If some of the goods do not conform to the contract, the buyer must accept or reject all of the goods.

Accepted Answer

Under the Uniform Commercial Code (UCC), a buyer has the right to accept some goods and reject others if they do not conform to the contract.

Question 14

If a seller discovers that the buyer has received goods on credit and is insolvent, the seller can demand return of the goods.

Accepted Answer

Under the Uniform Commercial Code (UCC), if a seller discovers that a buyer has received goods on credit while insolvent, the seller has the right to reclaim the goods within a certain period.

Question 15

If a breach occurs when the seller or lessor is still in possession of the goods, the seller or lessor must still deliver the goods.

Accepted Answer

If a breach occurs, the seller or lessor may have the right to withhold delivery of the goods depending on the terms of the contract and applicable laws.

Question 16

Incidental damages are calculated as the difference between the contract price and the price the seller was able to recover by selling the goods to a third party.

Accepted Answer

Incidental damages refer to the reasonable expenses incurred by a buyer or seller due to a breach of contract, such as costs for transportation or storage, not the difference between contract and resale price.

Question 17

The buyer or lessee has a right to inspect the goods before making payment and this right cannot be waived.

Accepted Answer

The right to inspect goods before payment can be waived if both parties agree to such terms in their contract.

Question 18

If a merchant buyer or lessee rightfully rejects nonconforming goods, he or she may resell the goods and retain the proceeds, without liability to the seller.

Accepted Answer

If a merchant buyer or lessee rightfully rejects nonconforming goods, they may resell the goods, but they must account to the seller for any excess proceeds over the amount of their security interest.

Question 19

Revocation of acceptance is not allowed if a buyer accepted nonconforming goods based on a reasonable assumption that the seller would cure the defect.

Accepted Answer

The answer of Revocation of acceptance is not allowed if...

Question 20

Payment on a contract can be made by any means agreed on between the parties.

Accepted Answer

The parties involved in a contract can mutually agree on any method of payment, as long as it is legal and clearly stipulated in the contract terms.

Quiz 19: Performance and Breach