Question 1

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)recover from Big Dig for breach of warranty.
B)do nothing.
C)file criminal charges against Big Dig and Credit Collection.
D)recover damages from Credit Collection for breach of warranty.

Accepted Answer

Arnold can recover from Big Dig for breach of warranty because when Big Dig sold the backhoe to Arnold, they implicitly warranted that the title was clear of any liens or claims, such as the one held by Credit Collection Company.

Question 2

MotorCo,Inc.,makes and sells auto parts to retail repair services,vehicle sales outlets,and consumer parts stores.On one MotorCo box is a label that reads "Contains one gross (144)sparkplugs,assorted sizes." This statement is
A)an implied warranty of fitness for a particular purpose.
B)an implied warranty of merchantability.
C)an express warranty.
D)none of the choices.

Accepted Answer

The statement on the label is explicitly stating that the box contains one gross of sparkplugs in assorted sizes. Therefore, it is an express warranty. Implied warranties of fitness for a particular purpose and merchantability are not applicable in this case as the label is providing a clear statement of what the product contains.

Question 3

Eden Valley Ranch and Farm Supply Corporation enter into a contract for a sale of fencing materials.Farm Supply,a merchant who deals in goods of the kind,makes implied and express warranties in connection with the sale.Under the UCC,if these are inconsistent
A)all implied warranties displace all express warranties.
B)all express warranties displace all implied warranties.
C)the implied warranty of fitness for a particular purpose takes precedence.
D)the implied warranty of merchantability takes precedence.

Accepted Answer

The answer of Eden Valley Ranch and Farm Supply Corporation...

Question 4

Livestock Feedlot orders one hundred sacks of cattle feed from MegaNutrient Feed,Inc.Each sack is stamped with the phrase "Twenty percent protein." This is
A)an express warranty.
B)an implied warranty.
C)a warranty of title.
D)puffery.

Accepted Answer

The phrase "Twenty percent protein" is a specific statement made by MegaNutrient Feed, Inc. about the product they are selling, which creates an express warranty that the feed contains a certain amount of protein.

Question 5

Medical Equipment Supply Company and Natural Rehabilitation Center enter into a contract for a lease of a certain number of wheelchairs.Medical Equipment assures the lessee that it has valid title to the goods.Under the UCC,this type of title warranty arises
A)automatically.
B)only if the buyer asks for such a warranty.
C)only if the seller expresses such a warranty.
D)only if the seller actually has valid title to the goods.

Accepted Answer

Under the UCC, a warranty of title arises automatically in every sales contract, regardless of whether the buyer asks for it or the seller expresses it. This warranty ensures that the seller has valid title to the goods being sold and that the sale is lawful. Therefore, Medical Equipment's assurance to Natural Rehabilitation Center that it has valid title to the leased wheelchairs is an automatic warranty of title under the UCC.

Question 6

Watercourse Pipe Company includes in its contracts a provision that reads,in large red letters,"There are no warranties that extend beyond the description on the face hereof." This disclaimer effectively negates
A)the implied warranty of fitness for a particular purpose.
B)the implied warranty of merchantability.
C)the implied warranty of title.
D)none of the choices.

Accepted Answer

The answer of Watercourse Pipe Company includes in its contracts...

Question 7

Phoenix,a salesperson for Quality Fruit,Inc.,shows Robert,a buyer for Sweet Home Fruit Company,samples of peaches,stating that any shipment will match the samples.This statement is
A)an express warranty.
B)an implied warranty.
C)a warranty of title.
D)puffery.

Accepted Answer

Phoenix's statement is an express warranty because it is a specific statement made by the seller about the quality or condition of the product being sold.

Question 8

Freddi buys bike shoes from Get n' Gear Store,telling the clerk that she wants the shoes to compete in High Pace Triathlon.The shoes break apart during the competition,causing Freddi to be injured in a fall.Get n' Gear most likely breached
A)an express warranty.
B)an implied warranty of fitness for a particular purpose.
C)an implied warranty of merchantability.
D)a warranty of title.

Accepted Answer

Freddi specified that she needed the bike shoes for a competition, and therefore, the clerk implicitly warranted that the shoes were suitable for that particular purpose. The shoes' failure caused Freddi to be injured, so Get n' Gear breached the implied warranty of fitness for a particular purpose.

Question 9

Chord Guitars,Inc.,sells guitars and other stringed instruments to consumers.A Chord salesperson says to a potential customer,"This Chord is the best guitar you'll find anywhere,even online." This statement is
A)an implied warranty of fitness for a particular purpose.
B)an implied warranty of merchantability.
C)an express warranty.
D)none of the choices.

Accepted Answer

The answer of Chord Guitars,Inc.,sells guitars and other stringed instruments...

Question 10

Aerospace,Inc.,makes and sells flight navigation equipment,through independent salespersons,to retailers for resale to consumers.The Magnuson-Moss Warranty Act covers
A)implied warranties,oral statements,and written promises.
B)only implied warranties that consumers are aware of.
C)only a salesperson's oral statements.
D)only a seller's written promises.

Accepted Answer

The answer of Aerospace,Inc.,makes and sells flight navigation equipment,through independent...

Question 11

Replay Sports Stores and SportsPower Products,Inc.,enter into a contract for a sale of trampolines.SportsPower Products is a merchant who deals in goods of the kind sold.Under the UCC,an implied warranty of merchantability arises
A)automatically.
B)only if the buyer asks for such a warranty.
C)only if the seller expresses such a warranty.
D)only in conjunction with lease contracts,not sales contracts.

Accepted Answer

Under the UCC, when a merchant sells goods of the kind they deal in, an implied warranty of merchantability arises automatically, without the need for the buyer to ask for it or the seller to express it. The warranty ensures that the goods are fit for their ordinary purpose and adhere to industry standards.

Question 12

Marcos buys a pneumatic drill from NuTools,Inc.Owen leases a table saw from Piecework Tools Sales & Lease Company.Later,Marcos and Owen become aware of defects in the goods that indicate breaches of warranty.An action for breach of warranty accrues when
A)the seller or lessor tenders delivery.
B)the buyer or lessee becomes aware of the breach.
C)the nonbreaching party notifies the breaching party of the breach.
D)four years have passed since the breach occurred.

Accepted Answer

An action for breach of warranty accrues when the seller or lessor tenders delivery, as this is the point at which the buyer or lessee can first evaluate the goods against the warranties provided.

Question 13

Riverside Ranch is a horse breeding facility.Steed Stables is a customer looking for a new stallion for its breeding program.Riverside's representative Tomas shows Steed a stallion that he says is very fertile and can easily breed twenty mares per year.This statement is
A)an express warranty.
B)an implied warranty.
C)a warranty of title.
D)puffery.

Accepted Answer

This statement is an express warranty because Tomas is making a specific factual claim about the stallion's breeding capabilities, which can be relied upon by the buyer.

Question 14

Regal Autos,Inc.,sells cars to consumers.To avoid potential liability for oral express warranties,each Regal sales agreement should note that a car is sold
A)as is.
B)in perfect condition.
C)subject to warranties included in the written contract only.
D)with no known defects.

Accepted Answer

Including a clause that warranties are only those included in the written contract helps avoid liability for any oral express warranties that might have been made during the sales process.

Question 15

Quade is an expert in twentieth-century art.Rachel visits Quade's gallery,seeking to buy artwork as an investment.Quade shows her a painting that in his opinion is by Picasso.Quade's statement is
A)an express warranty.
B)an implied warranty.
C)an opinion.
D)puffery.

Accepted Answer

The answer of Quade is an expert in twentieth-century art.Rachel...

Question 16

Trucks & Trailers,Inc.(T&T),and United Delivery Service enter into a contract for a lease of trucks.T&T is a merchant who deals in goods of the kind leased.Under the UCC,an implied warranty of merchantability arises
A)automatically.
B)only if the lessee asks for such a warranty.
C)only if the lessor expresses such a warranty.
D)only in conjunction with sales contracts,not lease contracts.

Accepted Answer

Under the UCC, an implied warranty of merchantability automatically arises in contracts for the lease of goods when the lessor is a merchant who deals in goods of the kind leased. This warranty ensures that the leased goods are fit for their intended purpose and are reasonably safe, reliable, and suitable for the ordinary purposes for which such goods are used. Therefore, Choice A is the correct answer.

Question 17

Grande Floors,Inc.,and Home Decor Stores enter into a contract for a sale of carpeting.Grande Floors,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)by clear,conspicuous language called to the buyer's attention.
B)by implied affirmations of fact relating to the goods.
C)in any way that the seller sees fit for the ordinary purpose.
D)in no way.

Accepted Answer

Under the UCC, an express warranty can be disclaimed or modified by clear, conspicuous language called to the buyer's attention. This means that the disclaimer or modification must be written in such a way that it is easily noticeable and understandable to the buyer at the time of the sale. Implied affirmations of fact relating to the goods or any other way the seller chooses is not valid under UCC. Therefore, option A is the best choice.

Question 18

Beginners Run Ski Shop sells a pair of skis to Crystal.When Crystal first uses the skis,they snap in two.The cause is something that Beginners Run did not know about and could not have discovered.Beginners Run breached
A)the merchant's implied duty of inspection.
B)the implied warranty of merchantability.
C)no duty or warranty because Beginners Run knew nothing about the defect that made the goods unsafe.
D)no duty or warranty because consumers should reasonably expect to occasionally find a product that does not work as warranted.

Accepted Answer

The answer of Beginners Run Ski Shop sells a pair...

Question 19

Rita eats Salsa Caliente made and sold by Salsa Zest Corporation and becomes ill.Rita files a suit against Salsa Zest,alleging that its product was not merchantable.Merchantable food is food that is fit to eat on the basis of
A)consumer expectations.
B)what constitutes a perfect condition.
C)its maker's intentions.
D)its producer's experience.

Accepted Answer

Merchantable food is determined by consumer expectations, meaning it meets the reasonable expectations of the average consumer regarding its safety and quality. It does not necessarily have to be in perfect condition, nor is it based solely on the maker's intentions or producer's experience.

Question 20

Band Instruments,Inc.,sells seventy-six trombones to Community & School Band Source,Inc.To avoid liability for most implied warranties,Band Instruments should state in writing that the trombones are sold
A)as is.
B)by a merchant.
C)in perfect condition.
D)with no known defects.

Accepted Answer

By stating that the trombones are sold "as is," Band Instruments is indicating that they are not making any promises or guarantees about the condition of the instruments, and that the buyer is taking on the risk of any defects or issues that may arise. This effectively limits their liability for implied warranties.

Quiz 23: Warranties

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

MotorCo,Inc.,makes and sells auto parts to retail repair services,vehicle sales outlets,and consumer parts stores.On one MotorCo box is a label that reads "Contains one gross (144) sparkplugs,assorted sizes." This statement is

Eden Valley Ranch and Farm Supply Corporation enter into a contract for a sale of fencing materials.Farm Supply,a merchant who deals in goods of the kind,makes implied and express warranties in connection with the sale.Under the UCC,if these are inconsistent

Livestock Feedlot orders one hundred sacks of cattle feed from MegaNutrient Feed,Inc.Each sack is stamped with the phrase "Twenty percent protein." This is

Medical Equipment Supply Company and Natural Rehabilitation Center enter into a contract for a lease of a certain number of wheelchairs.Medical Equipment assures the lessee that it has valid title to the goods.Under the UCC,this type of title warranty arises

Watercourse Pipe Company includes in its contracts a provision that reads,in large red letters,"There are no warranties that extend beyond the description on the face hereof." This disclaimer effectively negates

Phoenix,a salesperson for Quality Fruit,Inc.,shows Robert,a buyer for Sweet Home Fruit Company,samples of peaches,stating that any shipment will match the samples.This statement is

Freddi buys bike shoes from Get n' Gear Store,telling the clerk that she wants the shoes to compete in High Pace Triathlon.The shoes break apart during the competition,causing Freddi to be injured in a fall.Get n' Gear most likely breached

Chord Guitars,Inc.,sells guitars and other stringed instruments to consumers.A Chord salesperson says to a potential customer,"This Chord is the best guitar you'll find anywhere,even online." This statement is

Aerospace,Inc.,makes and sells flight navigation equipment,through independent salespersons,to retailers for resale to consumers.The Magnuson-Moss Warranty Act covers

Replay Sports Stores and SportsPower Products,Inc.,enter into a contract for a sale of trampolines.SportsPower Products is a merchant who deals in goods of the kind sold.Under the UCC,an implied warranty of merchantability arises

Marcos buys a pneumatic drill from NuTools,Inc.Owen leases a table saw from Piecework Tools Sales & Lease Company.Later,Marcos and Owen become aware of defects in the goods that indicate breaches of warranty.An action for breach of warranty accrues when

Riverside Ranch is a horse breeding facility.Steed Stables is a customer looking for a new stallion for its breeding program.Riverside's representative Tomas shows Steed a stallion that he says is very fertile and can easily breed twenty mares per year.This statement is

Regal Autos,Inc.,sells cars to consumers.To avoid potential liability for oral express warranties,each Regal sales agreement should note that a car is sold

Quade is an expert in twentieth-century art.Rachel visits Quade's gallery,seeking to buy artwork as an investment.Quade shows her a painting that in his opinion is by Picasso.Quade's statement is

Trucks & Trailers,Inc.(T&T) ,and United Delivery Service enter into a contract for a lease of trucks.T&T is a merchant who deals in goods of the kind leased.Under the UCC,an implied warranty of merchantability arises

Grande Floors,Inc.,and Home Decor Stores enter into a contract for a sale of carpeting.Grande Floors,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

Beginners Run Ski Shop sells a pair of skis to Crystal.When Crystal first uses the skis,they snap in two.The cause is something that Beginners Run did not know about and could not have discovered.Beginners Run breached

Rita eats Salsa Caliente made and sold by Salsa Zest Corporation and becomes ill.Rita files a suit against Salsa Zest,alleging that its product was not merchantable.Merchantable food is food that is fit to eat on the basis of

Band Instruments,Inc.,sells seventy-six trombones to Community & School Band Source,Inc.To avoid liability for most implied warranties,Band Instruments should state in writing that the trombones are sold