Kai files a suit against Lana based on one of Lanas statements that Kai alleges is
fraudulent. To give rise to fraud, the statement must be one of
a. emotion.
b. fact.
c. illusion.
d. opinion.
Odell is a director of Price Rite, Inc. As a director, with respect to the corporation, Odell
is
a. a fiduciary.
b. a forum.
c. a proxy.
d. a quorum.
Any decision by the management of Fast-Food Franchise Corporation may significantly
affect its
a. operators only.
b. operators, owners, suppliers, the community, or society as a whole.
c. owners only.
d. suppliers, the community, or society as a whole only.
Under a destination contract, the risk of loss passes to the buyer when the goods are
duly delivered to the carrier.
a. True
b. False
An accountant normally will be held liable to the client for incorrect judgment.
a. True
b. False
False imprisonment occurs when a person restrains another intentionally and without
justification.
a. True
b. False
In most states, revocation becomes effective on receipt.
a. True
b. False
Acting in good faith gives a business firm a better chance of defending its actions in
court.
a. True
b. False
Richard suspects his supervisor of unethical accounting practices. However, he does not
want to lose his job if he reports the supervisor and the supervisor finds out who
reported him. An important feature of online reporting systems like NAVEX Global is
a. the employee reporting the unethical behavior can do so anonymously.
b. the employee reporting the unethical behavior is financially compensated if he loses
his job as a result of the report.
c. the employee reporting the unethical behavior must give his full name when making
the report.
d. the employee reporting the unethical behavior must have another employee
supporting him.
Both employers and employees contribute to help pay for benefits that will partially
make up for the employees loss of income on retirement.
a. True
b. False
Ceramic Tile Company designs and makes floor tiles. In a product liability suit based
on negligence, Ceramic could be liable for vio-lating its duty of care with respect to
a. neither the design nor the making of the tiles.
b. the design and the making of the tiles.
c. the design of the tiles only.
d. the making of the tiles only.
Sonia manages a Tasty Pastry store for United Food Company. To manage the business,
Sonias authority can be implied by
a. an inference from the position Sonia occupies.
b. any inference a reasonable customer or supplier would make.
c. any inference Sonia chooses to make.
d. no inference.
The owner of intellectual property may put restrictions on the use of the intellectual
property in a license agreement.
a. True
b. False
Skyla and Terry want to form and do business as Unique Boutique Corporation. Its
existence depends generally on
a. city or county corporate codes.
b. the Entrepreneurs Corporate Handbook.
c. the federal Administrative Procedure Act.
d. state law.
Personal defenses are used to avoid payment to an ordinary holder of a negotiable
instrument, but not to an HDC or a holder through an HDC.
a. True
b. False
The filing of a petition for bankruptcy will automatically stay most legal actions against
the debtor.
a. True
b. False
Fay pays $800 for a new iPad to Global Goods, Inc. Global holds the iPad until Fay
picks it up. Global is
a. a bailee.
b. a consignee.
c. a lessee.
d. a seller.
Straitway Company encourages its managers to behave ethically, reasoning that the
employees will take their cues from management. One of the most important ways to
create and maintain an ethical behavior workplace is for management to
a. demonstrate a commitment to ethical decision making.
b. discreetly engage in unethical or illegal acts.
c. look the other way when an employee engages in an unethical act.
d. direct employees to “do as we say, not as we do.
Bren leases an apartment from Cris for one year. After two months, she sublets the
premises for the next six months to Dee, without obtaining Criss con-sent. Dee pays the
rent for only four months. For the last two months of Dees six-month term, Bren is
a. liable for the rent, because Dee defaulted.
b. not liable for the rent, because Bren does not own the apartment.
c. not liable for the rent, because Bren does not own the apartment.
d. not liable for the rent, because Bren sublet the premises to Dee.
Shareholder voting agreements are usually held to be invalid and unenforceable.
a. True
b. False
A marketing technique can be a trade secret.
a. True
b. False
A copy doesnotneed to be exactly the same as the original to infringe a copyright.
a. True
b. False
A contract is an agreement that can be enforced in court.
a. True
b. False
Wytex, Inc., a U.S. firm, and Findora Commercial, a Nigerian firm, are parties to a
contract that specifies that the official language of the contract is English. This is
a. a choice-of-forum clause.
b. a choice-of-language clause.
c. a choice-of-law clause.
d. an arbitration clause.
A debtor is the person in whose favor there is a security interest.
a. True
b. False
Maggie is a surety for Julis debt to Bill. Bill and Juli decide to make material changes
to the original contract without consulting Maggie. Maggie is
a. still bound by the contract.
b. discharged completely.
c. still bound by the contract, but allowed to make additional changes to the contract.
d. still bound by the contract unless she contests it within 30 days of the changes.
Authority declared in clear, direct, definite terms is express authority.
a. True
b. False
Levis Toy Store orders one hundred board games from Big Board Games Warehouse.
When the games are delivered, they are all missing pieces. Levis Toy Store rejects the
shipment. Big Board Games wants to cure. Big Board Games must
a. promptly notify Levis Toy Store of the intent to cure.
b. pay Levis Toy store a cure fee.
c. send a truck to pick up the nonconforming goods before the end of the business day.
d. create a new contract with Levis Toy Store.
Until the time for performance under a contract expires, the seller has a right to cure.
a. True
b. False
The doctrine of sover-eign immu-nity cannot immunize a foreign nation from the
jurisdiction of U.S. courts.
a. True
b. False
A life insurance contract involves an intended beneficiary.
a. True
b. False
Jaime, an accountant, contracts to perform services for Kase. Jaime acts in good faith
and conforms to generally accepted accounting principles, but makes a mistake in
judgment. Jaime is most likely
a. liable if Jaime failed to discover a defalcation.
b. liable if Jaime failed to discover a fraud.
c. liable if Jaime failed to discover an impropriety.
d. not liable.