Res ipsa loquitur shifts the burden of proof from the plaintiff to the defendant.
a. True
b. False
One of the accountant’s most important roles is to serve as an independent evaluator of
the financial statements issued by management to investors and creditors.
a. True
b. False
Which of the following states was not onlythe first state to regulate the sale of
securities, but also has the term “blue sky laws” named after it?
a. Montana
b. Kansas
c. Wyoming
d. New York
Generally speaking, managers feel better about themselves when they behave ethically.
a. True
b. False
In the case of a typo,a court will reform a contract if there is clear and convincing
evidence that the allegedmistake does not actually reflect the true intent of the parties.
a. True
b. False
Mrs. Elsley was an elderly woman who relied on Nancy to visit her every day and
prepare her meals. Nancy convinced Mrs. Elsley that she should give Nancy her house
so they could live together and Nancy could better care for her, although Nancy really
just wanted the house and had no intention of moving in to take care of Mrs. Elsley.
Although Mrs. Elsley agreed, she may rescind the contract because of undue influence.
a. True
b. False
Which of the following is NOT required of an agency relationship?
a. Consideration between parties
b. A Fiduciary relationship
c. Consent of the parties to act as agent or principal
d. Control of principal over agent’s conduct
A sellers form clearly states no warranty is included. The buyers form states that the
seller warrants the goods for one year. In this case
a. no contract can be created.
b. the warranty term is a “different term, and the majority of states hold that a contract
can be formed but the contradictory terms cancel each other out.
c. the warranty term is an “additional term that becomes part of the contract in most
states.
d. the warranty term is a “different term, which in most states becomes part of the
contract unless the seller promptly objects.
Some of the elements of a contract are acceptance, consideration, legality, and capacity.
a. True
b. False
An S Corporation cannot have more than ____ shareholders.
a. 100
b. 75
c. 50
d. 25
Darlene conveys her beachfront property to Dan as a life estate, and upon Dan’s death,
the property will revert to Darlene or her heirs. Darlene’s future interest in the
beachfront property is called a remainder.
a. True
b. False
Frank suffers from a mental impairment due to a brain injury from a airplane accident.
He contracts with Glena to purchase her dining room furniture. A month later, he tries to
void the contract. If he is unable to return the furniture, a court will not rescind the
agreement unless Frank can show that Glena acted in bad faith.
a. True
b. False
Which of the following exculpatory clauses will most likely be enforceable?
a. An exculpatory clause that relieves a riding stable of negligence.
b. An exculpatory clause that relieves a riding stable of gross negligence.
c. An exculpatory clause that relieves a riding stable from intentional torts.
d. A riding stables exculpatory clause that is hidden in an eight-page document that all
riders are required to sign.
Which of the following is NOT a protected category under Title VII?
a. Unattractiveness
b. Race
c. National origin
d. Sex
Chapter 7 bankruptcy is also known as
a. reorganization.
b. reaffirmation.
c. voluntary bankruptcy.
d. straight bankruptcy.
The Supreme Court has held that in awarding punitive damages, a court must consider
three “guideposts.” Which of the following is NOT one of these guideposts?
a. the reprehensibility of the defendant’s conduct
b. whether or not compensatory damages will also be awarded
c. the ratio between the harm suffered and the award
d. the difference between the punitive award and any civil penalties used in similar
cases
A witness testifying in a court or legislature may never be sued for defamation.
a. True
b. False
In a shipment contract, the risk passes to the buyer when the goods are properly
tendered at the destination point.
a. True
b. False
Which of the following is NOT an advantage to plaintiffs alleging racial discrimination
and filing under the Civil Rights Act of 1866?
a. a four-year statute of liminations
b. unlimited compensatory and punitive damages
c. assistance in filing from the Equal Employment Opportunity Commission
d. applicability to all employees, not just those with 15 or more employees
Christy’s new office lease states that rent will increase by 2% per year to cover tax
increases. This is known as
a. a tax mitigation.
b. an escalator clause.
c. a fee escalation.
d. a tax abatement.
The right of the tenant to the undisturbed possession of the leased property is known as
a. quiet enjoyment.
b. habitability.
c. lawful possession.
d. peaceful possession.
Company policy of PushOne, Inc. is to block the company name and telephone number
on potential customers Caller ID systems so they wont know the call is from a
telemarketer. This policy violates FTC rules.
a. True
b. False
Rhonda is a server in a restaurant. One day she finds a purse while clearing a table. The
purse is most likely
a. lost property.
b. mislaid property.
c. treasure trove.
d. abandoned property.
Sandy, Ramon, and Bonnie were partners. Sandy dissociated from the partnership.
Bonnie and Ramon decided to continue the business. When Sandy dissociated, there
was a $50,000 debt owed to Great State Bank. Which statement is correct?
a. Sandy remains liable on the $50,000 debt owed to Great State Bank.
b. Only Ramon and Bonnie are liable for the $50,000 debt owed to Great State Bank.
c. The debt is extinguished as a result of the dissociation.
d. Whether Sandy remains liable depends on whether she filed a statement of
dissociation.
Which of the following is NOTrequired to create a valid trust?
a. Legal age and sound mind of the grantor
b. Witnesses
c. A beneficiary(ies)
d. Property transferred to the trust
Anne and Mike were winding up their partnership. Mike was approached by a person
who wanted the partnership to do some work for him. Mike agreed that the partnership
would do the work. Generally speaking, in such a situation
a. Anne is not liable since the partnership was in the winding up phase.
b. Anne is not liable since she did not consent to the work.
c. Anne is not liable since Mike’s conduct was wrongful.
d. Anne is liable unless she filed a statement of dissolution with the Secretary of State
within 90 days of when Mike entered the contract.
Maddie enters into a secured consumer debt transaction with Friendly Bank. When
Maddie pays the loan in full, Friendly Bank is required to file a statement indicating
that it no longer claims a secured interest in the collateral. This statement must be filed
within one month from the date the debt is fully paid.
a. True
b. False
The Gulf States Section, PGA, Inc. v. Whitney National Bank of New Orleans case
addressed liability on a negotiable instrument
a. based on fraud.
b. based on negligence.
c. as an accommodation party.
d. as a signer.
Which of the following statements about torts is correct?
a. A tortious act is always a criminal act.
b. A criminal act is always a tortious act.
c. A tortious act may also be a criminal act.
d. A tortious act is the same as a contract dispute.
What is the goal of the Superfund?
a. To create a market-based system for reducing emmissions
b. To set national ambient air quality standards
c. To clean up hazardous wastes that were illegally dumped in the past
d. To require shipowners to pay for damage caused by oil discharged from their ships
Great State Bank loans money to Seth, securing the loan with property owned by Seth.
Great State Bank is advised by its attorney to file a financing statement. Great State
Bank doesn’t understand why it should spend the extra money for this filing, since Seth
has told them that he has no other creditors. Why should Great State Bank file a
financing statement?
a. There are criminal penalties for failing to file.
b. The financing statement allows Great State Bank to repossess the collateral on
default without a court order.
c. The financing statement will protect Great State’s priority rights with other creditors
by giving notice to other creditors that it claims a security interest in the collateral.
d. Filing the financing statement is necessary to complete the attachment requirement in
order to create a security interest.
The Moores’ lease contains a clause allowing their landlord to raise their rent during the
course of their lease if the landlords property taxes increase on the leased premises.
This clause is unenforceable, since tenants deserve to know their rent amount is fixed
during their agreed rental time.
a. True
b. False