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Sample Sales Questions

True/False
Indicate whether the sentence or statement is true or false.
 

1. 

UCC, Article 2, does not apply to private parties.
 

2. 

A gift is considered a sale.
 

3. 

The UCC has abolished the common law requirement of consideration in all contracts involving the sale of goods.
 

4. 

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.
 

5. 

The UCC does not apply to contracts for the sale of goods if the value of the goods is less than $500.
 

6. 

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.
 

7. 

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.
 

8. 

The UCC is federal legislation enacted by Congress.
 

9. 

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.
 

10. 

The UCC emphasizes getting the right results, rather than following rigid rules of contract law.
 

11. 

E-presto contracted to buy 30 computers from Computers Plus. This contract is governed by Article 2 of the UCC.
 

12. 

Lian contracted for financial services from E-wise. This contract is governed by Article 2 of the UCC.
 

13. 

Zubair, Inc. leased the 34th floor in an office building in downtown Pittsburgh. This contract is governed by Article 2 of the UCC.
 

14. 

In a mixed contract involving goods and services, Article 2 of the UCC will govern if the predominant purpose is the sale of goods.
 

15. 

The UCC imposes a duty of good faith in the performance of all contracts.
 

16. 

The highest level of ownership in goods would be a voidable title.
 

17. 

Generally, the UCC focuses on basic fairness and sensible business practices.
 

18. 

The UCC looks solely upon "title" to determine ownership in goods.
 

19. 

Crops are considered identified when they are harvested.
 

20. 

A purchaser can never acquire better title than the seller had.
 

21. 

Both the buyer and seller may have an insurable interest in goods.
 

22. 

Under the UCC, the party who has title to the goods always has the risk of loss.
 

23. 

Under the UCC, parties may allocate the risk of loss any way they wish.
 

24. 

Murphy stops at a garage sale and purchases an oak rocking chair. Murphy and the seller agree that Murphy will pick up the rocking chair the next day when Murphy will return with a truck. That night, an earthquake happened and the rocking chair was swallowed up by earth and totally destroyed. In this case, the seller had the risk of loss and must refund the purchase price to Murphy.
 

25. 

Regardless of the language of the contract, title passes to the buyer at the time and place at which the seller physically delivers the goods.
 

26. 

A sale is not a bulk sale if made in the ordinary course of business.
 

27. 

Arco sells 1,000 computers to Melvin that are stored in Arco's warehouse. Arco gives Melvin the ownership documents and Melvin will pick up the computers at the warehouse. Title has passed to Melvin.
 

28. 

A buyer has an insurable interest in goods when they are identified.
 

29. 

The Valley Forge Insurance co. v. Great American Insurance Co. case held title of a vehicle had not yet passed to the buyer.
 

30. 

In a shipment contract, title and risk of loss pass to the buyer when the goods are properly tendered at the destination point.
 

31. 

Myrtle walks into Hank's Hardware Store and says, "I need metal storage shelves that can hold 500 pounds." Hank directs her to a metal storage shelving system. Myrtle buys the shelving recommended by Hank. When Myrtle puts 475 pounds of weight on the bottom shelf, it breaks. Hank's Hardware breached the warranty of merchantability.
 

32. 

For an express warranty, the statement must be a fact, and not an opinion.
 

33. 

Under the UCC, no warranty of title arises unless the contract is in writing.
 

34. 

Express warranties must be in writing.
 

35. 

Assume that Veronica steals Archie's set of golf clubs and sells them to Jug Head. Under the UCC, Archie may reclaim the golf clubs from Jug Head and Jug Head may collect damages from Veronica for breach of warranty of title.
 

36. 

The Magnuson Moss Warranty Act requires sellers to give written warranties.
 

37. 

The concept of strict liability is grounded in fault, whereas the negligence theory is attributed to the defendant's conduct.
 

38. 

Generally, the parties to a contract may limit or alter the damages recoverable for a breach of warranty, as long as their actions are not unconscionable.
 

39. 

Many states prohibit a seller from disclaiming implied warranties in the sale of consumer goods.
 

40. 

If Mark, a power tool salesman, promises Jill, a customer, that the Turbo Power Hedge Trimmer 1000 will easily cut through bamboo up to 3 inches thick. Mark's statement constitutes an express warranty if Jill purchases the hedge trimmer.
 

41. 

Strict liability is based on contract law.
 

42. 

In warranty cases, the UCC imposes a four-year statute of limitations.
 

43. 

In a tort case, the statute of limitations runs from the time the defect was discovered.
 

44. 

A statute of repose places an absolute limit on when a lawsuit may be filed regardless of when the defect is discovered.
 

45. 

The economic loss doctrine states that, when the injured party is a corporation and the harm is purely economic, the only remedies available are those under the Magnuson-Moss Warranty Act.
 

46. 

The UCC requires "good faith" be exercised in the performance of contracts by all parties.
 

47. 

Tender means to physically deliver the goods to the buyer.
 

48. 

A flexible "perfect tender rule" applies in contracts governed by the UCC.
 

49. 

At common law, the requirement that the seller make a tender of delivery that conformed in all respects to the contract requirements was called the perfect tender rule.
 

50. 

A seller may not remove the goods and make minor necessary repairs or adjustments that will bring the goods into conformity in order to "cure" nonconforming goods.
 

51. 

Wimble ordered $800 worth of pro-quality luminescent orange tennis balls from Sports Unlimited. On June 1, Sports Unlimited shipped standard white tennis balls that were rejected by Wimble. Wimble bought the same number of pro-quality luminescent orange balls from another supplier the same day for $550. In a suit against Sport Unlimited, Wimble may recover $800.
 

52. 

Courts will generally enforce a damage limitation clause even if it is unreasonable.
 

53. 

"Course of Dealing" refers to prior transactions among the same parties.
 

54. 

The right to "cure" continues until a reasonable amount of time past the contract deadline.
 

55. 

A buyer who accepts nonconforming goods may not revoke the acceptance under any circumstances.
 

56. 

The Feltner v. D&H Impact Marketing, Inc. case held that after acceptance, the buyer has the burden of proof to establish goods are nonconforming.
 

57. 

Liquidated damages are never permitted under the UCC.
 

58. 

If Chuck buys cheese from Cheese Inc., then fails to inspect the cheese within a reasonable amount of time and does not reject the shipment, Chuck has accepted the shipment even if there is non-conformity.
 

59. 

A buyer's material breach gives the seller the right to refuse to deliver the goods.
 

60. 

Incidental damages are those that result from the costs of forming the initial contract.
 



 
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