COB 318 EXAM 3 MCCARTHY JMU | COMPREHENSIVE BUSINESS STUDY GUIDE,
PRACTICE QUESTIONS & ANSWERS 2026/2027
Contract Elements (COCAL) - ANS ✔✔Offer
Acceptance
Consideration
Capacity
Legality
Offer Elements (2) - ANS ✔✔1) Definite Terms- Parties + Specific goods/services + communicated
2) Termination = revoke, reject, counter, time-lapse, subject matter destroyed, offerer dies, law changes
Acceptance (MEMB) - ANS ✔✔1) mirror image rule
2) mailbox rule
3) bilateral/ unilateral contracts
4) express authorization
Consideration - ANS ✔✔Value = money, item/good, promise to act, promise not to act (forbearance,
Homer v. Sidway)
Illusory consideration - ANS ✔✔pre-existing duty
past consideration (Baugh v. CHC)
Capacity - ANS ✔✔If a party lacks capacity, contract is voidable
1) Minors
2) mental incompetence
3) involuntary intoxication
legality (GUUR) - ANS ✔✔Illegal = void
1) gabling
2) unlicensed professional
3) unconscionable
4) K in the restraint of trade
Statutes of fraud (PRS1) - ANS ✔✔1) Prenups
2) real estate
3) sales of goods >$500
4) K > 1 year
Types of Performance (SSTDD) - ANS ✔✔1) Strict (complete) performance
2) Substantial performance
3) Timeliness of performance
4) Discharge by agreement
5) Discharge by operation of law
Strict Performance - ANS ✔✔1) all material terms
, 2) exactly as agreed upon
Substantial performance - ANS ✔✔1) good faith effort
2) Minor deviation
3) Substantially the same outcome
Timeliness of performance - ANS ✔✔"time is of the essence" clause
Discharge by Agreement (SMANC) - ANS ✔✔1) mutual recession
2) novation
3) settlement
4) accord and satisfaction
5) covenant not to sue
Discharge by operation of law (SCIBM) - ANS ✔✔1) material alteration
2) statute of limitations
3) Bankruptcy
4) Commercially impracticable
5) Impossibility of performance
Elements to Involuntary Consent (DUMF) - ANS ✔✔1) Mutual mistake of material fact
2) Fraudulent misrepresentation
3) Duress
4) Undue Influence
Fraudulent Misrepresentation (MIJA) - ANS ✔✔1) Misrepresentation of material fact
2) Intent to decieve
3) Justifiable reliance
4) Actual Harm
Duress - ANS ✔✔- Threats or Psychological pressure to force contract
- Threat of force and extortion
Third party contractual rights (DAT) - ANS ✔✔1) Assignment
2) Delegation
3) Third party beneficiaries
Delegation - ANS ✔✔non-delegation clause
"personal contact"
Damages (CCPNL) - ANS ✔✔1) Compensatory damages
2) Consequential Damages
3) Punitive damages
4) Nominal Damages
5) Liquidation damages
Damages (non money) - ANS ✔✔Equitable remedies = Specific performance and reformation
PRACTICE QUESTIONS & ANSWERS 2026/2027
Contract Elements (COCAL) - ANS ✔✔Offer
Acceptance
Consideration
Capacity
Legality
Offer Elements (2) - ANS ✔✔1) Definite Terms- Parties + Specific goods/services + communicated
2) Termination = revoke, reject, counter, time-lapse, subject matter destroyed, offerer dies, law changes
Acceptance (MEMB) - ANS ✔✔1) mirror image rule
2) mailbox rule
3) bilateral/ unilateral contracts
4) express authorization
Consideration - ANS ✔✔Value = money, item/good, promise to act, promise not to act (forbearance,
Homer v. Sidway)
Illusory consideration - ANS ✔✔pre-existing duty
past consideration (Baugh v. CHC)
Capacity - ANS ✔✔If a party lacks capacity, contract is voidable
1) Minors
2) mental incompetence
3) involuntary intoxication
legality (GUUR) - ANS ✔✔Illegal = void
1) gabling
2) unlicensed professional
3) unconscionable
4) K in the restraint of trade
Statutes of fraud (PRS1) - ANS ✔✔1) Prenups
2) real estate
3) sales of goods >$500
4) K > 1 year
Types of Performance (SSTDD) - ANS ✔✔1) Strict (complete) performance
2) Substantial performance
3) Timeliness of performance
4) Discharge by agreement
5) Discharge by operation of law
Strict Performance - ANS ✔✔1) all material terms
, 2) exactly as agreed upon
Substantial performance - ANS ✔✔1) good faith effort
2) Minor deviation
3) Substantially the same outcome
Timeliness of performance - ANS ✔✔"time is of the essence" clause
Discharge by Agreement (SMANC) - ANS ✔✔1) mutual recession
2) novation
3) settlement
4) accord and satisfaction
5) covenant not to sue
Discharge by operation of law (SCIBM) - ANS ✔✔1) material alteration
2) statute of limitations
3) Bankruptcy
4) Commercially impracticable
5) Impossibility of performance
Elements to Involuntary Consent (DUMF) - ANS ✔✔1) Mutual mistake of material fact
2) Fraudulent misrepresentation
3) Duress
4) Undue Influence
Fraudulent Misrepresentation (MIJA) - ANS ✔✔1) Misrepresentation of material fact
2) Intent to decieve
3) Justifiable reliance
4) Actual Harm
Duress - ANS ✔✔- Threats or Psychological pressure to force contract
- Threat of force and extortion
Third party contractual rights (DAT) - ANS ✔✔1) Assignment
2) Delegation
3) Third party beneficiaries
Delegation - ANS ✔✔non-delegation clause
"personal contact"
Damages (CCPNL) - ANS ✔✔1) Compensatory damages
2) Consequential Damages
3) Punitive damages
4) Nominal Damages
5) Liquidation damages
Damages (non money) - ANS ✔✔Equitable remedies = Specific performance and reformation
