Interactive Quiz for ALT-12e, Chapter 19
Chapter 19 – The Formation of Sales and Lease Contracts
1. The Uniform Commercial Code (UCC) attempts to provide which of the
a. guidelines for making common law contracts that deal with the sale of
b. a framework for all international contracts dealing with the sale of
c. a consistent and integrated framework of rules to deal with all aspects
of commercial sales transactions.
d. a consistent body of rules for dealing with criminal violations of the law
that involve either securities or government bonds.
a. Incorrect. The UCC does not deal with the sale of land at all.
b. Incorrect. The UCC does not cover many international sales.
c. Correct. The UCC attempts to provide a logical framework for these
kinds of commercial transactions.
d. Incorrect. The UCC does not deal with criminal law at all.
2. Article 2 of the UCC governs:
a. contracts for the sale of land.
b. contracts for the sale of goods.
c. negotiable instruments.
d. bulk sales.
a. Incorrect. The common law, not the UCC, governs contracts for the
sale of land.
b. Correct. Article 2 covers contracts for the sale of goods.
c. Incorrect. Article 3 deals with negotiable instruments.
d. Incorrect. Article 6 deals with bulk sales.
3. If Jim sells Smith copper that he removed from land that he owns in
Colorado, this contract:
a. will be covered by Article 2 of the UCC.
b. will be covered by Article 2A of the UCC.
c. will be covered by Article 3 of the UCC.
d. will be covered by the common law.
a. Correct. Jim is selling a good that he has separated from the land.
Therefore, this contract will be covered by Article 2.
b. Incorrect. Article 2A covers leases, and this is a sale.
c. Incorrect. Article 3 covers negotiable instruments.
d. Incorrect. Although Jim is selling a good associated with real estate,
the copper has been separated from the land; thus, the sale of the
copper will be governed by the UCC.
4. If you lease an automobile from an automobile dealer, this contract is
a. Article 2 of the UCC.
b. Article 2A of the UCC.
c. Article 6 of the UCC.
d. the common law, because it involves an intangible good.
a. Incorrect. Article 2 covers contracts for the sale of goods, not leases or
subleases of goods.
b. Correct. Article 2A covers leases of goods.
c. Incorrect. Article 6 covers bulk transfers, not subleases.
d. Incorrect. This contract involves the lease of tangible goods, not
intangible goods, and leases of goods are covered by Article 2A of the
5. The effect of open terms on a contract covered by the UCC is that:
a. the contract will be void because of the open terms.
b. the contract will be valid if it involves the sale of land.
c. the contract will be valid if the parties intended to form a contract and
there is a reasonable basis for a court to grant a remedy.
d. the contract will be valid as long as the parties expressed some
interest in negotiating.
a. Incorrect. The UCC provides “gap-filling” provisions that the courts
apply to contracts with open terms.
b. Incorrect. Remember, the UCC does not cover contracts for the sale of
c. Correct. As long as both requirements are met, the contract will be
d. Incorrect. The parties must do more than express an interest in
negotiating; they must express an intent to form a contract. 3
6. Suppose that Frank offers to sell to Keith an antique armoire worth more
than $2,500. Keith agrees to buy the armoire and signs a contract for the
purchase. The price of the armoire, however, is left out of the contract. In
a. there is a contract as long as the court can determine a reasonable