Sales contracts

Question 1

Up to what amount can seller retain as liquidated damages when buyer defaults?

Answer 1

$500, as long as reasonable estimate of damages to seller

Question 2

The general terms “as is” or “with all faults” disclaims which warranty: warranty of title and against infringement or warranty of fitness and merchantability?

Answer 2

Warranty of fitness and merchantability

Question 3

Title and risk of loss transfer to the buyer at the time of: sale or payment?

Answer 3

Sale

Question 4

Warranty of merchantability can be disclaimed by an oral statement or a written statement?

Answer 4

Either or both

Question 5

Warranty of merchantability requires which to be a merchant: buyer, seller, or both

Answer 5

Seller

Question 6

Under what doctrine is a common carrier liable for the goods it transports even if it did not act negligently?

Answer 6

Doctrine of strict liability

Question 7

Article 2 of the UCC covers the sale of: goods or services?

Answer 7

Sale of goods

Question 8

Common law covers the sale of: goods or services?

Answer 8

Sale of services

Question 9

Under the UCC, a revocation of a written promise by a merchant to keep an offer open is effective or ineffective?

Answer 9

Ineffective (firm offer)

Question 10

Title and the risk of losses pass to the buyer at the time seller tenders delivery of goods to buyer if seller is: merchant or nonmerchant?

Answer 10

Nonmerchant

Question 11

What is the maximum reasonable time allowed if time is not specified in a written promise by a merchant to keep an offer open?

Answer 11

3 months

Question 12

Under the UCC, which of the following must be specified to create an enforceable contract for the sale of the goods? Type, description, quantity of goods; price of the goods; signature of parties?

Answer 12

Type, description, quantity of goods

Question 13

Warranty of title applies if seller is: merchant or nonmerchant?

Answer 13

Either

Question 14

This releases the party from their contractual duties: impossibility of delivery OR impracticality of delivery

Answer 14

Impossibility of delivery

Question 15

An agreement to custom manufacture goods by the seller at the request of the buyer must be in writing and cannot be in oral agreement only. True or False?

Answer 15

False. This is an exception to the Statue of Frauds rule that sale of goods for more than $500 is unenforceable.

Question 16

Warranty of merchantability is implied when the seller is: merchant or nonmerchant?

Answer 16

Merchant

Question 17

In a shipment contract, when a seller ships nonconforming goods the risk of loss is with: buyer OR seller?

Answer 17

Seller

Question 18

This may limit or excuse a common carrier’s liability for damage to goods in transit: providing for a contractual dollar liability limitation OR willful acts of third parties?

Answer 18

Providing for a contractual dollar liability limitation

Question 19

Goods are the responsibility of the buyer upon transfer of: title OR risk of loss?

Answer 19

Risk of loss

Question 20

Article 2 of the UCC covers the sale of: goods OR services?

Answer 20

Goods