Excelsior Bus230 M8A3 – Final Examination

Faldo Corp Sells On Terms That Allow Customers 45 Days To Pay For Merchandise
July 13, 2019
6 accounting basic questions
July 13, 2019

Excelsior Bus230 M8A3 – Final Examination

Question

Question 1

2.5 out of 2.5 points

When Article 2 is silent on an issue of sales contract formation or interpretation and there is no state statutory law in place on that matter, _____.

Question 2

2.5 out of 2.5 points

The UCC was created in ____.

Question 3

2.5 out of 2.5 points

Beau went shopping at ABC Carpet. He saw some carpet he liked but could not make up his mind. The manager at ABC Carpet wrote down the proposed purchase price for him along with a statement that the price would be good for three months. Two months later Beau went back to ABC Carpet to purchase the carpet. Unfortunately, the price had gone up. Beau showed the manager his writing and guaranteed price, but the manager said that the offer was no longer good. Although he had to pay more than the ABC manager had initially promised, Beau proceeded to purchase his carpet from XYZ carpet, and he also contracted with XYZ to do the installation. Unfortunately, Beau almost immediately started to have problems with the carpet. Beau told the sales manager for XYZ Carpet that he was planning on bring suit for breach of warranty. The sales manager, however, told him that the breach of warranty provisions only applied to sales of goods and that the carpet purchase was for installation, a service. Which of the following is true regarding whether the UCC applies to the contract Beau had with XYZ Carpet?

Question 4

2.5 out of 2.5 points

Under the Uniform Limited Liability Company Act, unless the operating agreement specifies otherwise, LLCs are ______ managed.

Question 5

2.5 out of 2.5 points

Sidney is injured in an automobile accident and cannot work. She cannot pay her bills and files for bankruptcy relief under Chapter 7. She is in a state that allows her to claim federal exemptions, and she does so. She lists as exempt $15,000 in equity in her residence; interest in a car of $2,000, interest in jewelry of $400; and retirement funds in her individual retirement account. Her creditors filed an objection to all claimed exemptions. What is the status of the exemption she claimed on the residence?

Question 6

2.5 out of 2.5 points

Paul, who runs a retail jewelry store, went with Jane, to whom he was engaged to be married, to a wholesale jewelry store. Paul had no express, written agreement with Jane by which she was his agent. The wholesaler jeweler, Pam, asked Paul if Jane was buying for him. Paul did not want to embarrass Jane so he nodded in agreement. A few minutes later Paul whispered to Jane, outside the hearing of the wholesaler, that she should not make any purchases. Paul and Jane had a big disagreement over money that evening, and Jane broke off their engagement. The next day Jane went back to the wholesale jeweler and purchased a string of pearls for $2,000. Jane also purchased a fur jacket for $3,000 from a store, owned by Harry, that was next door to the jewelry store. She told Harry that Paul wanted a fur for a model in his store and that Paul would be glad to pay Harry for the jacket. What type of agency, if any, did Jane have to act on behalf of Paul as far as Pam is concerned?

Question 7

2.5 out of 2.5 points

Rebecca bought a toaster from Super Store and brought it home. A friend of hers, Greg, was at her house making toast. The toaster malfunctioned and shocked Greg resulting in a small burn to his hand requiring medical attention. At a garage sale, Rebecca also purchased a blender from a friend, Samantha. When she paid for the blender, Rebecca said that it would be great for making smoothies. Samantha said nothing and just smiled while taking Rebecca’s money. Unfortunately, the blender was not powerful enough to make smoothies. Which of the following is true regarding whether Samantha made an express warranty to Rebecca that the blender would make smoothies?

Question 8

2.5 out of 2.5 points

Which of the following occurs when the purchased goods are transferred to the buyer from the seller at either the time of the sale or some time later by the seller’s delivery?

Question 9

2.5 out of 2.5 points

Which of the following is a relationship between two or more persons or corporations created for a specific business undertaking?

Question 10

2.5 out of 2.5 points

Which of the following generally does not offer stock to the public?

Question 11

2.5 out of 2.5 points

Doreen writes a check for a dress to Hot Dresses, Inc., a small specialty shop whose shares were owned primarily by Betty. Betty was getting ready to go on an extended European vacation and temporarily closed down the shop the next day. When Betty returned, she had a number of other things to do and did not take Doreen’s check and some other checks to the bank for three months. Betty was independently wealthy and only ran the shop as a hobby, so she had not been in need of funds. When Betty finally took Doreen’s check to the bank, Betty requested that her bank, ABC Bank, deposit the check into her account. When ABC Bank, however, requested payment from Doreen’s bank, XYZ Bank, the check was dishonored because of insufficient funds in Doreen’s account. Although Betty did not particularly need the funds, she did not like to feel as if she had been cheated; therefore, she demanded that Doreen make the check good. Which of the following is the holder of the check?

Question 12

0 out of 2.5 points

Which of the following methods for dividing income or loss divides income among partners on the basis of differences in service and capital contributions?

Question 13

0 out of 2.5 points

Paula agreed to mow John’s yard once a week for $50 per week throughout the summer. Paula, however, was having trouble getting her money from John. On one occasion, he in handwriting gave her in IOU saying “I, John Jones, owe Paula Smith $50.” A couple of weeks later, John did not have the money to pay Paula what he owed her, and he handwrote the following on a piece of paper and gave it to her: “I, John Jones, promise to pay Paula Smith or to bearer, the sum of $100 on Monday, July 22, 2008.” Paula quit mowing John’s yard, and disgusted with John, Paula assigned both documents to Vince. When Vince presented the documents to John, John refused to pay on the basis that after inspecting the yard, he decided that Paula was doing a poor job. Vince told him the documents constituted negotiable instruments, but John pointed out that he had not signed the documents with his signature at the end. Disregarding the issue of whether Paula properly performed, is the statement “I, John Jones, promise to pay Paula Smith or to bearer, the sum of $100 on Monday, July 22, 2008,” without a signature anywhere else on the document, sufficient to satisfy negotiability requirements?

Question 14

2.5 out of 2.5 points

All states, except Louisiana, follow the ______ common law.

Question 15

2.5 out of 2.5 points

Donnie went to a new car dealership and told the salesperson, who was not the manager, that he needed a new car that would get good gas mileage and would also pull his big boat. The salesperson encouraged him to buy a smaller car that the salesperson promised would pull the boat. Donnie bought the car and used it to pull the boat. Unfortunately, the heavy pull on the car did significant damage to the car’s engine.Donnie complained to the car salesperson who denied any liability. Donnie, who had half a semester of business law, informed the salesperson that along with the sale of the car he also received an express warranty and an implied warranty of merchantability, and that he could recover under either of those theories. Will Danny likely be able to recover damages based upon breach of an express warranty?

Question 16

2.5 out of 2.5 points

With a simple delivery contract, when does title transfer to the buyer?

Question 17

2.5 out of 2.5 points

Wally and Sally want to go into business together and plan on offering a tutoring service to high school and college students. Wally proposes that they share control of the business and split profits equally and not bother with a written agreement. Sally, however, is concerned about being able to pay their debts since they will have to rent tutoring space, and purchase computers and supplies. She is also concerned about parents and students who may sue if the students’ test scores do not improve. She tells Wally that she just bought a new boat and car, and that she does not want her assets to be in jeopardy. She tells Wally that they should form a corporation to shield their personal assets. Wally, however, says their personal assets are not in danger with his proposal because they are a business and that, furthermore, forming a corporation would likely result in higher taxation. What type of arrangement did Wally propose with his suggestion that they share control of the business and split profits equally?

Question 18

2.5 out of 2.5 points

Wendy is president of a business that manufactures kites. The kites of her company, ABC Kites, are sold to large toy stores. After Wendy learned a great deal about kites, she started to make kites at home. She also started selling kites to friends. Some of the directors learned about her kite sales and accused her of wrongdoing. Wendy denied any wrongdoing. What duty, if any, did Wendy violate?

Question 19

2.5 out of 2.5 points

Marcy purchased a used car from ABC Motors. Six months later the police seized the car from Marcy on the basis that it was a stolen vehicle.Marcy asked for her money back from ABC Motors. The manager there told her that the car was not stolen; that even if it were stolen, ABC Motors acted in good faith with no knowledge of a theft; and that, therefore, no refund was legally required. ABC Motors had also sold a used car to Frank who wrote a bad check for the car and left town, but not before selling the car to Betty. Betty purchased the car with no knowledge of any problem with the check. ABC Motors asked Betty to return the car, but she refused. Assuming that the car was stolen prior to delivery to ABC Motors and without the knowledge of any representative of ABC Motors, what kind of title did ABC Motors have?

Question 20

2.5 out of 2.5 points

In proportion to the capital contribution, with partners who contributed more capital being allocated less in the way of losses. If corporations act beyond their express and implied powers, the act is called a[n] ______ act.

Question 21

2.5 out of 2.5 points

Which of the following is the right to insure goods against any risk exposure such as damage or destruction?

Question 22

2.5 out of 2.5 points

If a customer’s ATM card is lost or stolen, the customer must notify the bank within _____ days; and if that is done, the customer is then liable for only the first _____ stolen.

Question 23

2.5 out of 2.5 points

Which of the following is true regarding joint ventures?

Question 24

2.5 out of 2.5 points

Which of the following is the most popular form of business ownership in the U.S.?

Question 25

2.5 out of 2.5 points

Which of the following is a person who has a duty to act primarily for another person’s benefit?

Question 26

2.5 out of 2.5 points

Dennis purchased a big screen television from ABC Electronics and financed the purchase through ABC Electronics. Later, because Dennis had bought a boat, a new car, an expensive engagement ring for his girlfriend, and some other items, he was unable to continue making payments on the television. The manager from ABC Electronics called and asked Dennis to return the television. Dennis refused on the basis that ABC Electronics never perfected its interest in the television. Which of the following is the proper designation under the UCC for the television?

Question 27

2.5 out of 2.5 points

If a principal agrees to hire no other agent for a period of time or until a particular job is done, the principal and agent have entered into a[n] ______ agency contract.

2.5 out of 2.5 points

Which of the following is true if an owner entrusts the possession of goods to a merchant who deals in goods of that kind?

Question 29

2.5 out of 2.5 points

Which of the following is true regarding liability of an agent acting within his or her authority on a contract involving an undisclosed principal?

Question 30

0 out of 2.5 points

Molly makes great chocolate chip cookies and sells them. She calls them “Molly’s Famous Chocolate Chips.” Some of her friends are interested in selling her cookies. They want to use her name and identify the cookies as “Molly’s Famous Chocolate Chips.” Molly says, however, that she does not have enough time to bake any more cookies. She agrees, for a price, to allow her friends to use her recipe and her name. Suzette, one of Molly’s friends who was selling the cookies, was not being sufficiently careful and negligently put a harmful ingredient into the cookie dough resulting in a customer, Fred, becoming ill. Fred threatens to sue both Suzette and Molly. Molly is so exasperated that she cancels all the franchise contracts on the basis of aggravation. Although the franchise agreements provided that so long as requirements were met, the franchise agreements were good for a period of two years, Molly took the position that the cookies involved a personal service and that she could not be held liable for discontinuation. What type of arrangement did Molly make with her friends?

Question 31

2.5 out of 2.5 points

What does the term CIF when used as a shipping term represent?

Question 32

2.5 out of 2.5 points

Which of the following is a form of authority upon which an agency relationship may be based?

Question 33

2.5 out of 2.5 points

Under Article 2 of the UCC which of the following is defined as tangible things which are movable at the time of identification to the contract for sale?

Question 34

2.5 out of 2.5 points

Which of the following occurs when purchased goods are in some kind of storage under the control of a third party, such as a warehouseman?

Question 35

2.5 out of 2.5 points

Jason, who is very knowledgeable regarding computers, agrees to purchase computers for Nick’s business. Jason is retained for that purpose only, he is paid a set rate for the job, and Nick exercised no control over the manner in which Jason did his work. Jason purchased computers on credit from ABC Computers without any mention of Nick. The computers worked well and were not defective in any way. Unfortunately, Nick did not pay ABC Computers on a timely basis. Jason, therefore, paid ABC Computers out of his own pocket because he wanted to be able to do business with ABC in the future and also because his name was on the invoice. Jason asked Nick for reimbursement, but Nick refused. Nick claimed that if Jason had only waited, ABC Computer might have agreed to take less. Which of the following is true regarding any right of reimbursement Jason is due from Nick?

Question 36

2.5 out of 2.5 points

Selina arranges to sell furniture from her furniture store to Roland for $3,000. Roland was supposed to give Selina a $500 deposit on February 1 and pay the remainder in monthly installments. Selina was to deliver the furniture by February 7. Roland did not pay Selina as promised on February 1. He asked her to wait until March 1, but she refused. She also refused to deliver the furniture. Selina was able to sell the furniture for only $2,500 because of a downturn in the economy. Roland told Selina that she had no right to withhold or sell his furniture and that he was suing. Selina also incurred $100 in additional amounts in advertising costs to advertise the furniture that Roland initially purchased. Selina saved $40 in delivery costs because she did not have to deliver the furniture to Roland. The subsequent purchaser picked up her own furniture. Which of the following is true regarding any deduction in damages to which Roland is entitled?

Question 37

2.5 out of 2.5 points

How are directors chosen after incorporation?

Question 38

2.5 out of 2.5 points

Which of the following requires that the seller make proper shipping arrangements and deliver goods to the buyer via a common carrier but not guarantee the safety of goods to their destination?

Question 39

2.5 out of 2.5 points

Which of the following is an individual who applies to the state for incorporation on behalf of a corporation?

Question 40

2.5 out of 2.5 points

Which of the following types of title occurs in certain situations where the contract between the original parties would be void but the goods have already been sold to a third party?

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