Question 1

Safety Insurance Agency contracts with Town Motors to buy six cars. The contract lists the cars by their VINs (vehicle identification numbers) . Under the UCC, identification

Accepted Answer

A)   requires the filing of a copy of the contract in the appropriate state office.
B)   has taken place.
C)   cannot take place unless the cars are in the seller's possession.
D)   cannot take place until the cars are in the buyer's possession.E) All of the above
F) A) and D)

Question 2

The parties can agree in their contract when identification will take place.

Accepted Answer

A) True 
 B)False

Question 3

Generally, the buyer acquires whatever title the seller has to the goods sold.

Accepted Answer

A) True 
 B)False

Question 4

When a buyer breaches a sales contract, the risk of loss remains with the seller to the extent of any deficiency in the buyer's insurance coverage.

Accepted Answer

A) True 
 B)False

Question 5

When no documents of title are required, title does not pass.

Accepted Answer

A) True 
 B)False

Question 6

United Wear Inc. and Winter Gear stores enter into a contract for a sale of coats. Their contract can indicate that the price includes transportation costs to a specific destination by including the term

Accepted Answer

A)   C.I.F.
B)   delivery ex-ship.
C)   F.A.S.
D)   F.O.B.E) A) and B)
F) B) and C)

Question 7

A contract between Fresh Fruit Corporation and Green Grocer Inc. requires Fresh Fruit to deliver goods to Green Grocer's place of business. This is

Accepted Answer

A)   a bill of lading.
B)   a destination contract.
C)   a shipment contract.
D)   a warehouse receipt.E) A) and D)
F) A) and C)

Question 8

After title passes to a buyer, a seller no longer has an insurable interest in the goods.

Accepted Answer

A) True 
 B)False

Question 9

If the seller is a merchant who is holding the goods for the buyer to pick up, the risk of loss passes when the buyer takes physical possession of the goods.

Accepted Answer

A) True 
 B)False

Question 10

Quaff Café buys twenty-five crates of apples from Reynaldo Produce, Inc. The parties agree to ship the apples "F.O.B. Quaff" via Swift Trucking Company. The apples rot in transit. The loss is suffered by

Accepted Answer

A)   Quaff.
B)   Swift.
C)   F.O.B.
D)   Reynaldo.E) A) and B)
F) B) and C)

Question 11

Garden Stores order a specific assortment of rose bulbs from Hybrid Company. Hybrid mistakenly ships a selection of annuals, which Garden rejects and returns via Indie Transport Inc. During the return, the annuals are lost. The loss is suffered by

Accepted Answer

A)   Garden.
B)   Hybrid.
C)   Indie.
D)   consumers by increases in the prices of other goods and shipping.E) C) and D)
F) None of the above

Question 12

A receipt issued by a warehouser for goods stored in a warehouse is a warehouse receipt.

Accepted Answer

A) True 
 B)False

Question 13

Roasters Corporation and Outdoor Barbecues Inc. enter into a contract for a sale of a commercial grill. The contract requires Roasters to deliver the goods to Speedy Delivery Company for transport to Outdoor. Risk of loss passes to Outdoor when

Accepted Answer

A)   Roasters delivers the goods to Speedy.
B)   Roasters and Outdoor enter into their contract.
C)   Speedy transports the goods to Outdoor.
D)   Outdoor begins to use the grill.E) A) and C)
F) All of the above

Question 14

When the risk of loss passes is generally determined by

Accepted Answer

A)   the passage of title to identified goods.
B)   the acquisition of an insurable interest in specific goods.
C)   the expression of a buyer or lessee's interest in obtaining certain goods.
D)   the terms of a contract for a sale or lease of goods.E) B) and D)
F) B) and C)

Question 15

Consumers Choice Store accepts a shipment of phones from Digital Devices Inc. Consumers Choice later discovers a defect in the phones, revokes acceptance, and returns the goods via GoBack, Inc. During the return, the goods are lost. The loss is suffered by

Accepted Answer

A)   Consumers Choice.
B)   Digital Devices.
C)   GoBack.
D)   consumers by increases in the prices of other goods and shipping.E) A) and B)
F) A) and C)

Question 16

An insurable interest is

Accepted Answer

A)   an interest in goods permitting a party to insure against their damage.
B)   an interest in ensuring that goods are of a certain quality.
C)   interest that can accrue from investing in insurance of certain goods.
D)   none of the choices.E) A) and B)
F) None of the above

Question 17

The UCC's provisions relating to passage of title do not apply to leases of goods.

Accepted Answer

A) True 
 B)False

Question 18

If the seller's title is void, the seller has the power to transfer good title to a good faith purchaser.

Accepted Answer

A) True 
 B)False

Question 19

Mountain Coffee Company and Nature's Cuisine Inc. enter into a contract for a sale of coffee beans. The contract includes the term "F.O.B. Ocean City," which is the location of Nature's Cuisine. This means that the contract is

Accepted Answer

A)   a bill of lading.
B)   a destination contract.
C)   a shipment contract.
D)   a warehouse receipt.E) A) and C)
F) None of the above

Question 20

If a seller supplies ten dishwashers in response to an order for ten washing machines-"F.O.B. the seller's warehouse"-and the goods are damaged in transit to the buyer's store, the loss falls on the seller.

Accepted Answer

A) True 
 B)False

Exam 20: Title and Risk of Loss

If the seller's title is void, the seller has the power to transfer good title to a good faith purchaser.

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After title passes to a buyer, a seller no longer has an insurable interest in the goods.

Correct AnswerverifiedShow Answer

When no documents of title are required, title does not pass.

Correct AnswerverifiedShow Answer

When the risk of loss passes is generally determined by

Correct AnswerverifiedShow Answer

The UCC's provisions relating to passage of title do not apply to leases of goods.

Correct AnswerverifiedShow Answer

If a seller supplies ten dishwashers in response to an order for ten washing machines-"F.O.B. the seller's warehouse"-and the goods are damaged in transit to the buyer's store, the loss falls on the seller.

Correct AnswerverifiedShow Answer

Roasters Corporation and Outdoor Barbecues Inc. enter into a contract for a sale of a commercial grill. The contract requires Roasters to deliver the goods to Speedy Delivery Company for transport to Outdoor. Risk of loss passes to Outdoor when

Correct AnswerverifiedShow Answer

Generally, the buyer acquires whatever title the seller has to the goods sold.

Correct AnswerverifiedShow Answer

Quaff Café buys twenty-five crates of apples from Reynaldo Produce, Inc. The parties agree to ship the apples "F.O.B. Quaff" via Swift Trucking Company. The apples rot in transit. The loss is suffered by

Correct AnswerverifiedShow Answer

Mountain Coffee Company and Nature's Cuisine Inc. enter into a contract for a sale of coffee beans. The contract includes the term "F.O.B. Ocean City," which is the location of Nature's Cuisine. This means that the contract is

Correct AnswerverifiedShow Answer

United Wear Inc. and Winter Gear stores enter into a contract for a sale of coats. Their contract can indicate that the price includes transportation costs to a specific destination by including the term

Correct AnswerverifiedShow Answer

Safety Insurance Agency contracts with Town Motors to buy six cars. The contract lists the cars by their VINs (vehicle identification numbers) . Under the UCC, identification

Correct AnswerverifiedShow Answer

When a buyer breaches a sales contract, the risk of loss remains with the seller to the extent of any deficiency in the buyer's insurance coverage.

Correct AnswerverifiedShow Answer

The parties can agree in their contract when identification will take place.

Correct AnswerverifiedShow Answer

A contract between Fresh Fruit Corporation and Green Grocer Inc. requires Fresh Fruit to deliver goods to Green Grocer's place of business. This is

Correct AnswerverifiedShow Answer

If the seller is a merchant who is holding the goods for the buyer to pick up, the risk of loss passes when the buyer takes physical possession of the goods.

Correct AnswerverifiedShow Answer

Consumers Choice Store accepts a shipment of phones from Digital Devices Inc. Consumers Choice later discovers a defect in the phones, revokes acceptance, and returns the goods via GoBack, Inc. During the return, the goods are lost. The loss is suffered by

Correct AnswerverifiedShow Answer

A receipt issued by a warehouser for goods stored in a warehouse is a warehouse receipt.

Correct AnswerverifiedShow Answer

An insurable interest is

Correct AnswerverifiedShow Answer

Garden Stores order a specific assortment of rose bulbs from Hybrid Company. Hybrid mistakenly ships a selection of annuals, which Garden rejects and returns via Indie Transport Inc. During the return, the annuals are lost. The loss is suffered by

Correct AnswerverifiedShow Answer

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