Flashcards in Intro to Sales Deck (40):
True/False: Lorene, an artist, orally agrees to sell Sabrina a painting for $600. While Lorene is busy talking on the phone, Sabrina writes her a note on the back of an envelope she finds in her purse. The signed note states that she will stop by the studio to pick up the painting within the week. Sabrina changes her mind about the painting, and when Lorene sues to enforce the contract, Sabrina defends on the basis of the statute of frauds. Sabrina will succeed with this defense.
True/False: Uncle Brandon promises to give his motorcycle to you at the end of the month. This transaction is governed by UCC, Article 2, because a motorcycle is within the definition of “goods.”
True/False: The UCC has abolished the common law requirement of consideration in all contracts involving the sale of goods.
True/False: Elizabeth worked as a salesperson in a carpet store. She was in the process of divorcing her husband and needed some money. Elizabeth sold her wedding ring. Elizabeth is considered a merchant with regard to the sale of the ring.
True/False: The UCC does not apply to contracts for the sale of goods if the value of the goods is less than $500.
True/False: If the seller has made a substantial beginning in manufacturing custom-ordered goods, then an oral contract may be enforceable regardless of the amount of money involved in the contract.
True/False: Rachel Retailer sends a preprinted purchase order offering to buy goods from Snidley Supplier. Snidley acknowledges Rachel's offer with a preprinted acceptance form. The terms of the two forms do not mirror each other. To analyze whether an enforceable contract exists, one must first determine whether the new language in the acceptance is an additional term or a different term.
True/False: The UCC is federal legislation enacted by Congress.
True/False: Megan agrees to sell Neff her quartz watch but they do not specify a price. In such a case, the court would not enforce the agreement because all of the essential terms are not present.
True/False: Leasing goods is an insignificant part of business, so its rules are governed by extensions of the UCC Article related to sales rather than having a separate article of the Code to cover leasing.
True/False: Under the UCC, a merchant is frequently held to a higher standard of conduct than a non-merchant.
True/False: Lian contracted for financial services from E-wise. This contract is governed by Article 2 of the UCC.
True/False: Zubair, Inc. leased the 34th floor in an office building in downtown Pittsburgh. This contract is governed by Article 2A of the UCC.
True/False: In a mixed contract involving goods and services, Article 2 of the UCC will govern if the predominant purpose is the sale of goods.
True/False: The UCC imposes a duty of good faith in the performance of all contracts.
In which of the following situations is the seller a merchant under Article 2 of the UCC?
ZOMPA INC. A TOY MANUFACTURER, CONTRACTED TO SELL DOLLS TO TONTON DEPARTMENT STORE
Office Plus, an office supply store, ordered 600 blank CDs from Curtis Co., a manufacturer of computer products. Office Plus placed the order using a preprinted purchase order form; Curtis acknowledged the order by sending a preprinted acceptance form back to Office Plus. Unlike Office Plus' form which says nothing about packaging, Curtis's form specifies that the CDs will be packaged in cases of 10 CDs per box, 10 boxes per case. Which statement is correct?
CURTIS’S PACKAGING TERM IS AN ADDITIONAL TERM AND THEREFORE A PART OF THE CONTRACT UNLESS OFFICE PLUS PROMPTLY OBJECTS TO THE TERM
Stanziano Construction needs a backhoe to complete a project. If it pays Hofmann Rentals for temporary use of the equipment, the transaction will be governed by:
ARTICLE 2A OF THE UCC
Tri, a full-time college student, sold his car to Don, another student. In the performance of this contract, Tri:
HAS A DUTY OF GOOD FAITH WHICH MEANS HONESTY IN FACT
Which of the following types of property would be classified as "goods" under Article 2 of the UCC?
In a "mixed contract," one involving a sale of both goods and services, the court will:
FIRST DETERMINE THE DOMINANT PURPOSE OF THE CONTRACT
Which of the following contracts requires a writing under the UCC, Article 2?
A TOY MANUFACTURER CONTRACTED TO SELL DOLLS VALUED AT 10 G’S TO A DPMT STORE
Newt, a gun dealer, offers to sell a rare civil war musket to Rush, another dealer, for "$15,000, insurance and shipping paid by buyer." Rush responds, "I accept. Insurance and shipping costs divided equally between seller and buyer." The parties:
HAVE A CONTRACT AND, IN THE MAJORITY OF STATES, THE DIFFERENT TERMS WILL CANCEL EACH OTHER OUT
Which of the following contracts is most likely to be declared unconscionable?
A CONSUMER SALES CONTRACT WHICH CHARGES 300 TIMES THE FAIR MARKET VALUE OF THE GOODS
If Edmund and Kaylin have a writing mistakenly showing a sale and purchase of goods for $10,000 when the price should have been $1,000, a court will:
ENFORCE THE AGREEMENT, RELYING ON ORAL TESTIMONY TO DETERMINE THE CORRECT PRICE
The difference between the UCC requirement of good faith and doctrine of unconscionability is that:
GOOD FAITH FOCUSES ON THE PARTIES’ BEHAVIOR AS THEY PERFORM THE CONTRACT
Which of the following is true regarding an open price term?
THE PRICE IS THE’REASONABLE’ PRICE AT THE TIME OF DELIVERY
To simplify, clarify, and modernize the law governing commercial transactions, the UCC permits the use of "open terms" in sales contracts. In the use of "open terms," which of the following is true?
ALL OF THE ABOVE ARE TRUE
Harriett raises and sells hippos. In order to keep her hippos happy and healthy, she feeds them Hippo Chow, which she buys from the local pet store. Under the UCC, Harriett is:
A MERCHANT OF HIPPOS, BUT NOT OF HIPPO CHOW
Dean Builders agrees to purchase all of its sump pump requirements for the new houses it builds from Satisfactory Sump Pump, Inc. These two business have had similar agreements the last three years and Dean's requirements have averaged 100 sump pumps per year. This year there was an unusually wet spring and Dean's requirements doubled to 200 sump pumps. Because of the high demand of sump pumps, the market price of the pumps tripled. Satisfactory Sump Pump, Inc. delivers 100 pumps at $75, the contract price. Satisfactory has exhausted its inventory and cannot deliver any more, so Dean buys the other 100 pumps from other suppliers at $225 each. Dean sues Satisfactory Sump Pump, Inc. for the additional expense. What is the most likely result?
SATISFACTORY SUMP PUMP INC WINS REQUIREMENTS CONTRACTS ARE GOVERNED BY A GOOD FAITH STANDARD AND IT WAS UNREASONABLE FOR DEAN TO DEMAND SO MANY ADDITIONAL PUMPS
Under the UCC statute of frauds, the writing for a sale of goods must:
A requirements contract is a contract:
IN WHICH THE SELLER PROVIDES ALL OF THE GOODS THAT THE BUYER NEEDS
Betty's BBQ orally contracts with Denny's Design House for 10,000 matchbooks at the price of 10 cents per matchbook. The matchbooks are to be embossed with a logo to be designed by Denny's Design promoting Betty's BBQ. Price, payment terms, delivery terms are agreed upon between the parties. Denny's Design creates the logo, gets Betty's BBQ's approval of the design and begins applying the logo on the matchbook covers. Denny's Design has almost finished the order when Betty's BBQ calls to say it has decided to make the eatery a smoke-free restaurant and cancels the order. Denny's Design sues, but Betty's BBQ states that the agreement is unenforceable under the statute of frauds. Who wins?
DENNY’S DESIGN HOUSE WINS. THIS SITUATION FALLS UNDER AN EXCEPTION TO THE STATUTE OF FRAUDS
Price’s Department Store contracted to buy 1,000 drop-waist velour dresses in heather gray from TriColor. Subsequently, TriColor called and asked to ship mink-colored dresses instead of heather gray. Price agreed, in writing, to the change. Which statement is correct?
THE MODIFICATION IS ENFORCEABLE
The stated purpose(s) of Article 2 of the UCC is/are:
ALL OF THE ABOVE ARE CORRECT
By definition, a sale under Article 2 of the UCC requires:
THAT TITLE TO THE GOODS PASS BETWEEN THE SELLER AND THE BUYER AND THAT A PRICE BE PAID FOR THE GOODS
UCC Section 2-204 provides three important rules that enable parties to make a contract quickly and informally. These include all but which of the following?
1. A WRITING SUFFICIENT UNDER THE STATUTE OF FRAUDS MAY BE A SIMPLE MEMO, LETTER…
Wayne agrees over the phone to sell L.J. Cartwright 1,000 yards of 1-inch diameter rope. Wayne honestly believes that L.J. Cartwright offered to pay $1.00 per yard whereas L.J.Cartwright actually offered to pay 75 cents per yard. If the parties subsequently take their dispute to court, the fact that L.J.Cartwright admits on the stand that he offered to pay Wayne 75 cents per yard will:
BOTH A AND C ARE CORRECT (L.J. CARTWRIGHT & WAYNE 1000)
During the development of commercial law centuries ago, businessmen throughout England and Europe:
ALL OF THE ABOVE