Scott, a State Bank employee, deposits into his account checks that are given to him by
bank customers to deposit into their accounts. This is
a. embezzlement.
b. larceny.
c. money laundering.
d. no crime.
Solar Power, Inc., files a suit against Thunder Bay Utility Company and seeks to
examine electronic documents in Thunders possession. A legitimate reason for this
examination is that the documents contain
a. evidence about the case.
b. private information about Thunders operations.
c. public information about energy generation.
d. irrelevant data that can be eliminated from consideration.
The owner of a fee simple absolute has the right to use property for whatever purpose
he or she sees fit.
a. True
b. False
Picking pockets is larceny.
a. True
b. False
Elinor performs ten hours of house cleaning for Zack in exchange for a promissory note
for $400. At the time that Elinor accepts the note, she is aware that bankruptcy
proceedings are being filed against Zack. Elinor
a. can obtain HDC status.
b. cannot obtain HDC status, because she knows that there are bankruptcy proceedings
against Zack.
c. cannot obtain HDC status, because she did not fulfill the value requirement.
d. cannot obtain HDC status, because she did not fulfill the good faith requirement.
Cybersquatting is illegal only if a domain name is identical to the trademark of another,
not if the name is merely confusingly similar.
a. True
b. False
Concealing assets from a bankruptcy court is a crime.
a. True
b. False
An ethical code of conduct typically outlines a companys policies.
a. True
b. False
Root & Branch Lumber Company obtains a fire insurance policy from Statistical
Insurers, Inc., on a $400,000 warehouse. The policy includes an 80-percent coinsurance
clause. Root & Branch insures the property for $320,000. In a fire, the warehouse
suffers $200,000 in damage. Root & Branch can recover
a. $400,000.
b. $320,000.
c. $200,000.
d. $80,000.
A partner is a co-owner of partnership property.
a. True
b. False
Bernard is an expert on exotic flowers. Fine Floral Fixtures, Inc. (FFF) hires Bernard to
order exotic flowers from various greenhouses. Bernard does not bother to examine the
quality of the flowers he purchases on behalf of FFF. Bernard has breached
a. the duty of performance.
b. the duty of loyalty.
c. no duty.
d. the duty of notification.
Lionel files a voluntary petition for bankruptcy under Chapter 7. The court will likely
deny a discharge of Lionels debts if he
a. conceals records of his financial condition with the intent to defraud a creditor.
b. does not have sufficient assets to pay all his secured creditors.
c. filed for bankruptcy twelve years ago.
d. has a criminal record.
If a seller fails to deliver the goods, the buyers damages do not include all losses
resulting from this course of events.
a. True
b. False
A transfer of contract duties to a third party is an assignment.
a. True
b. False
Managers should apply the same ethical standards to themselves and to their
employees.
a. True
b. False
The Uniform Commercial Code governs checks.
a. True
b. False
Inez and Jason are the shareholders and directors of Kleen Kustodial Corporation. Lily
and Moe are Kleens officers. As in other corporations, the responsibility for the overall
management of Kleen rests with
a. the board of directors.
b. the officers.
c. the owners.
d. the shareholders.
A closing argument is a statement by a party that results in a summary judgment in that
partys favor.
a. True
b. False
Contract law assures the parties to private agreements that the promises they make will
be enforceable.
a. True
b. False
General Leasing Company (GLC) buys equipment for use as inventory, borrow-ing $1
million from Helpful Finance Corporation for a security in-terest in the equipment. The
next day, GLC borrows $500,000 from Interstate Bank, also for a security interest in the
equipment. GLC defaults on the loans.
Refer to Fact Pattern 19-1. Suppose that two weeks after GLC takes pos-session of the
equipment, Helpful and Interstate file financing state-ments, with Interstate fil-ing first.
In that cir-cum-stance, the party with priority to the equipment is
a. GLC.
b. Helpful and Interstate proportionately.
c. Helpful only.
d. Interstate only.
Generally, stock offerings that involve a small dollar amount are ex-empt from the
registration requirement.
a. True
b. False
Under the power of eminent domain, the government may take private property only for
private use, not for public benefit.
a. True
b. False
When a customer deposits cash into a checking account, he or she becomes a debtor for
the amount deposited.
a. True
b. False
A law that has any impact on religion is unconstitutional.
a. True
b. False
Sid, a director of Tech Software Company, learns that a Tech engineer has developed a
new, exciting video game. Sid buys Tech stock and tells his friend Uri, who also buys
Tech stock. When the new game is released three weeks later, Sid and Uri sell their
stock for a big profit.Refer to Fact Pattern 26-2. Under SEC Rule l0b-5, Sid would not
be li-able if he had waited to buy Tech stock until
a. after Sid told Uri of the new game.
b. after Uri bought Tech stock.
c. after the public release of the game.
d. just before the game was released.
A product is unmerchantable if an accident could arise in connection with the goods.
a. True
b. False
Mary enters a gas station and points a gun at the clerk. She then forces the clerk to open
the cash register and give her all the money. Mary can be charged with
a. robbery.
b. forgery.
c. larceny.
d. embezzlement.
State courts cannot have exclusive jurisdiction.
a. True
b. False
Klondike and Leola own 10,000 shares of stock in My-T Gro Corporation. On the death
of either owner, that owners interest in the stock passes to the surviving owner. This is
a. ajoint tenancy.
b. community property.
c. a tenancy in common
d. ownership in fee simple.
The office in which a financing statement should be filed depends on the creditors
location.
a. True
b. False
Most bailments are created by agreement, but not necessarily by contract.
a. True
b. False
The Eighth Amendment prohibits excessive bail and fines, as well as cruel and unusual
punishment.
a. True
b. False
Jack contracts to provide lawn-mowing services to Lee. Jack can-not dele-gate this duty
a. because it is a personal service contract.
b. without continuing to be liable.
c. without Lees consent.
d. without providing lawn-mowing services to Kim.