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Exam 13: The Formation of Sales and Lease Contracts

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Question 1

Multiple Choice

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Fresh Dairy, Inc., is the offeror and Gelato Ice Cream Company is the offeree under a unilateral sales contract in which Hector's Helado Corporation is also interested. Gelato is not notified of Fresh Dairy's performance within a reasonable time. Gelato

A) ​may treat the offer as having lapsed.
B) ​must assume that Fresh Dairy has started to perform.
C) ​must contact Fresh Dairy.
D) must notify Hector's.

E) C) and D)
F) None of the above

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Question 2

Multiple Choice

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Manufacturing Corporation orders twelve safety videos from Productions, Inc., which delivers the videos. This is most likely

A) ​a gift.
B) ​a lease of goods.
C) ​a sale of goods.
D) ​a service contract.

E) A) and B)
F) B) and C)

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Question 3

Multiple Choice

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Refined Grains, Inc., agrees to sell to Sunny Cereal Company a certain quantity of refined oats 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

Car n' Truck Body & Paint Company orders custom paint from Diverse Hues Inc., but Diverse does not deliver. Car n' Truck will probably be unable to enforce the agreement if the parties omitted

Curt enters into a contract with Drivers Lease Company for a three-year lease of a car. This contract is subject to

A contract for the sale of minerals is considered to be a contract for the sale of goods if the severance is to be made by the seller.

Rice River Farms offers to sell Sensei Sushi Restaurants, Inc., five hundred bushels of rice. Sensei responds, "We agree to buy five hundred bushels only if the rice is Grade A quality." This statement is

Raul agrees to ship to Ben one hundred ceiling fans for $5,000. Raul initials his notes of the deal, which include the terms, and files the notes in his office. Ben initials his own notes of the deal, which include the terms, and files the notes in his office. Raul fails to ship the fans. Against Raul, as a contract, the deal is​

A merchant's firm offer is revocable at any time before acceptance.

UCC Article 2 applies to sales transactions between all buyers and sellers.

The UCC views the entire "commercial transaction for the sale of and payment for goods" as a single legal occurrence.

Talk, Inc., offers to buy from Ultra Corporation 1,000 smartphones. Without notifying Talk, Ultra timely ships phones of a different quality. With respect to the offer and a possible contract, this shipment is an acceptance and

Marine Expeditions, Inc., pays Nate's Boats $4,000 to use an oceangoing vessel for a month. For the purposes of the UCC, this is

When no delivery terms are specified in a contract for a sale of goods, there is no basis for determining a remedy.

Coffee Roasters, Inc., sells whole bean and ground coffee to Delicioso Deli under an existing contract. When the cost of coffee beans increases, Delicioso agrees to a price increase, but later wants to cancel the contract. Delicioso may

Brad buys a bulldozer from Construction Equipment Corporation, which he leases to Deep Digg, Inc. In this situation, the lessee is

Under the UCC, parties to sales and lease contracts are free to establish whatever terms they wish.

In interpreting a commercial agreement, a court will assume that the usage of trade was taken into account when the agreement was phrased.

Ferris is refinishing his kitchen floor and needs a floor sander to complete the job. Ferris's neighbor Gena suggests that he call Home Repair Rentals, Inc. Home Repair leases Ferris a floor sander. In this transaction, the lessor is

A lessor is a party who acquires a right to the possession and use of goods under a lease.