Archives: Quiz

Rollo is an attorney whose clients include Superior Credit Company. If Rollo is negligent in his work for Superior, under the Restatement (Second) of Torts, Rollo may be liable to Superior and a. any third party. b. no third party. […]

Fact Pattern 14-A3 Flip, an accountant, certifies an audit for Erstwhile Corporation, Flips client, knowing that Erstwhile will use the audit to obtain a loan from Deepwater Bank. Flip believes that the audit is true and does not intend to […]

Fact Pattern 39-1B Bertram, Claudia, and Dynah form Eat Local, Inc., a closely held corporation, and agree to restrict the transfer of its stock to anyone else. The agreement provides that if one of the shareholders dies, his or her […]

Lake Port Services enters into a contract to load Maxs Great Lakes barges with the cargo that Max designates. Lake Ports offer to perform, when Lake Port is ready, willing, able to do so, is a. complete. b. substantial. c. […]

Drake pushes Evon into the path of an oncoming car driven by Flip. Gina tries to rescue Evon, but the car hits both of them. Drake is liable for the injuries of a. Evon and Gina. b. Evon only. c. […]

Rupert, an agent for Star Productions, Inc., enters into an unauthorized contract with Theatrical Transport Corporation purportedly on behalf of Star, which refuses to perform. Rupert is liable a. for breach of contract to Star and Theatrical Transport. b. for […]

Discount Mart, Inc., is an East Coast-based firm that does business throughout the United States. With respect to this circumstance, the UCC has been adopted by, and applies in, a. all of the states, in whole or in part. b. […]

Through a certain transaction, Corporate Properties, Inc., acquires all of the shares of Downtown Realty Corporation for some of Corporate Propertiess shares. Both Corporate Properties and Downtown Realty continue to exist. This is a. a consolidation. b. a share exchange. […]

Credit & Debt Corporation loans Evelyn $25,000 to start a new business. Evelyn does not pay, but Credit & Debt fails to sue within the time prescribed by the applicable statute of limitations. Evelyn promises to pay a portion of […]

Deleon trespasses on Capital Corporations property. Through the use of reasonable force, Capitals security guard Brenda detains Deleon until the police arrive. Capital is most likely liable for a. abuse of process. b. false imprisonment. c. trespass to personal dignity. […]

Backwater Heavy Equipment Corporation currently employs three hundred full-time workers. Because business has declined, Backwater plans to lay off one hundred workers. If Backwater does not send advance notice of the layoff to the appropriate parties, the employer may be […]

Luke owns a farm near Marshalltown, Iowa, with stands of trees serving as windbreaks. Luke grows corn on the property. When Luke sells the farm to Nina, if the contract does not specify otherwise, the sale includes a. neither the […]

On behalf of the jazz group Synco-Passion, their manager Raul agrees to a performance in the Quay Club on May Portia, acting for Quay Club, sends a written copy of the agreement to Raul to be signed. Typically, businesspersons put […]

Janet and Julie work at ABC Interiors. Janet is a designer who works with clients of ABC on interior design projects. ABC closely supervises all of its designers, and dictates their work schedules. Julie works part-time in the evenings cleaning […]

A homeowner has a contract with a firewood supplier to bring a rick of hardwood at the beginning of each month from October through March. If the supplier has brought a mixture of hard and soft woods for the first […]

Identify four ways a trust can be terminated. After her 18th birthday Lora may, by words or action, ratify a contract she made during the previous year. Answer: T Kris, a shareholder of E-Max, Inc., claimed that the business was […]

The economic loss doctrine states that, when the injured party is a corporation and the harm is purely economic, the only remedies available are those under the common law. If Valley Bridge contracts with Rainbow Painters to paint a bridge […]

Marvin contracts with House Painters R Us to paint the interior of his house lemon yellow throughout. The total contract price is $7,000. House Painters R Us’s anticipated profit on the job is $4500. If Marvin breaches the contract before […]

The FTC blocked the merger of Staples, Inc. and Office Depot because they controlled a large percentage of the national market for office supplies. It is unethical to use your lawyer as an excuse for a provision of a contract, […]

Accounting contracts can be either written or oral. A claim in recoupment can be used against a holder in due course. Answer: F An Environmental Impact Statement must be prepared for every major federal action that significantly affects the quality […]

Under the UCC, no warranty of title arises unless the contract is in writing. Sweet Plantation, Inc. made a written contract with Candy, Inc. whereby Sweet Plantation agreed to supply all of Candy’s sugar requirements for the next year at […]

Sandy may be charged a fee, but will not face criminal penalties for writing checks on an account with insufficient funds to pay them. Mark and Cynthia work for Bryson Supply Co. If the company files for Chapter 7 bankruptcy […]

Ramiro is dissociated from the partnership he helped form ten years ago. If his partners want to continue the business, what must they do? Does it make any difference if the dissociation was wrongful? Tony signed a contract agreeing to […]

Tyron purchased a $2900 promissory note from Jared for the discounted amount of $2500. Tyron paid value, in good faith and without notice of any outstanding claims against this promissory note that read, “Pay to the order of Jared $2900 […]

A fundamental aim of the National Labor Relations Act is the establishment of industrial peace and the preservation of the flow of commerce. Adherents of the Post Chicago School use an antitrust analysis based solely on whether competition has been […]

An accommodation party and a co-maker of a note have the same liability on an instrument. Southern Bar-B-Q owns a special, secret recipe for sauce which it guards because it gives the restaurant a competitive advantage. If Mort willfully misappropriates […]

A corporation is not allowed to issue dividends to shareholders unless it is solvent. Explain the difference between an ISP and a Web host, and discuss whether they are treated alike under the Communications Decency Act (CDA). Answer: An Internet […]

Immanuel Kant was a German philosopher who was a proponent of utilitarian ethics. In hopes of speeding up the approval process and making it more accurate, the Patent and Trademark Office has begun a pilot program which allows anyone to […]

Chapters 11 and 13 are liquidation chapters. Doyle contributed $10,000 when he became a general partner in the existing partnership of R & Z Heating. If Albert wins a judgment for $25,000 against R & Z on a claim that […]

Under European Union law, any agreement, contract, or discussion that distorts competition within European Union countries is illegal. Drawers and indorsers are secondarily liable on negotiable instruments. Answer: T Identify and discuss six values that are almost universal. Answer: The […]

The United States is the worlds largest exporter of agricultural products. An agreement may violate public policy even if the agreement does not require a party to commit a crime, tort, or violate a statute. Answer: T The prohibition against […]

Wedney, Inc. sold a meat processing machine to Yoro Chickens, taking a security interest in the machine. Yoro Chickens defaulted on the loan. Wedney repossessed the machine. Wedney would like to retain the machine to use as a model. Which […]

Generally, reasonable liquidated damage clauses will be enforced: a. when actual damages are easily determined. b. when actual damages are difficult to determine. c. almost always. d. only in real estate sales contracts. Robin and Bellman, both merchants, orally agree […]

Betty wants to hire a secretary who is “mature.” In particular, she wants to hire a woman with experience and whose children are grown (so she will not have to be staying home with sick children, etc.). She also wants […]

The Administrative Procedure Act: a. applies to all federal agencies. b. applies to executive branch agencies but not to independent agencies. c. applies to independent agencies but not to executive branch agencies. d. does not apply to federal agencies. Farmer […]

Which of the following opinions indicates that the company’s financial statements fairly present its financial condition according to GAAP? a. Qualified opinion. b. Adverse opinion. c. Disclaimer of opinion. d. Unqualified opinion. Under a state law, a dog owner is […]

Two universities located within 30 miles of each other agree to divide their market so as to help them both. The two schools draw a line down a map and each university agrees to accept students only on their side […]

The Federal Trade Commission promulgated Telemarketing Sales Rules regulating the activities of telemarketers. One of the rules prohibits telemarketers from calling a person’s residence at any time other than between 8:00 a.m. and 9:00 p.m. This legislative rule has the […]

Monic, a college professor, makes 30 photocopies of a magazine article and passes the article out to her students. The students are assigned to read the article and write an opinion paper about it. Has Monic violated copyright law? a. […]

The directors of MegaCorp learn that an outsider is planning on buying enough voting stock to get herself elected to the board of directors. MegaCorp, which has cumulative voting, quickly puts together a vote of shareholders to eliminate the company’s […]

If Kay, a partner in an auction business, has a personal creditor who is aggressive about collecting the debt: a. Kay can sell her share in the partnership to repay the debt, regardless of what her partners want her to […]

Hill Computers is a retailer, which buys its inventory from Acme Co. on credit, giving Acme a security interest in the inventory. Hubert buys a computer from Hill in the normal course of business. Hubert’s title in the computer is: […]

Shirley is an actress under contract with Twentieth Century. Shirley agreed to perform the lead role in a musical to be filmed in Hollywood by Twentieth Century. At the last minute, Twentieth Century decided to scrap the musical and assigned […]

Hayden owes Luther $5000. Hayden will only be able to pay this debt if he is able to sell his one-year-old Harley motorcycle, valued at $20,000. Hayden writes a check to Luther that reads, “Payable to the order of Luther […]

If a court determines a manager’s corporate decision amounted to self-dealing: a. the business judgment rule will not apply. b. the transaction being challenged will be automatically voided. c. the manager is automatically personally liable to the corporation. d. All […]

Paula is a sales agent for The Rock Insurance Company. Paula accepts a check from a customer made payable to her in payment for the premium on an insurance policy. Prior to depositing the check in The Rock’s bank account, […]

Luella just purchased 5 shares of common stock in TriColor, Inc. for $250. Luella has the right to: a. manage the day-to-day business of the corporation. b. set executive compensation. c. require that a proposal be placed in the companys […]

Which of the following would be an example of a civil lawsuit? a. George is being prosecuted for bank fraud. b. The government has initiated an action against Jeff for operating a motor vehicle under the influence of alcohol. c. […]

If repossessed collateral is sold or otherwise disposed of by the creditor, the time, place, manner, and method of disposal must be: a. commercially reasonable. b. scheduled with the debtor so that the debtor is able to attend. c. court […]

The statute of limitations for breach of warranty under the UCC is? a. one year. b. two years. c. three years. d. four years. John purchased $600 worth of clothes from Clothing Mart. He paid for the clothes with a […]