CPA Reg Review Exam Questions and
Answers 100% Solved Already Passed
B
This answer is correct because under the common law, an acceptance
must be unequivocal and unqualified, in the precise terms in which the offer
specified. The Uniform Commercial Code alters this general rule as far as
the sale of goods is concerned. An offer to buy goods for prompt shipment
is construed to invite acceptance, either by a prompt promise to ship or
prompt shipment unless the language of the offer specifically stipulates
otherwise. Peel may accept Taylor's offer by promptly promising to ship the
goods or by prompt shipment. - ✔✔Taylor signed and mailed a letter to
Peel which stated: "Ship promptly 600 dozen grade A eggs." Taylor's offer
A. May be accepted by Peel only by a prompt shipment.
B. May be accepted by Peel either by a prompt promise to ship or prompt
shipment with notice.
C. Is invalid since the price terms were omitted.
D. Is invalid since the shipping terms were omitted.
,D
This answer is correct because the leasing arrangement, to which Allen is a
surety, remained intact with no modifications. The lease, itself, expressed a
holdover clause which went into existence when Lear remained in
possession after the original leasing period. The essence of a surety
arrangement is that the surety promises to perform upon default of the
principal debtor. Therefore, Allen becomes liable when Lear defaults during
the extended term of the lease. - ✔✔Allen was the surety for the payment
of rent by Lear under a lease from Rosenthal Rentals. The lease was for 2
years. A clause in the lease stated that at the expiration of the lease, the
lessee had the privilege to renew upon 30 days' prior written notice or, if
the lessee remained in possession after its expiration, it was agreed that
the lease was to continue for 2 years more. There was a default in the
payment of rent during the extended term of the lease and Rosenthal is
suing Allen for the rent due based upon the guarantee. Allen contends that
he is liable only for the initial term of the lease and not for the extended
term. Allen is
,A. Not liable since it does not appear that a judgment against Lear has
been returned unsatisfied.
B. Not liable because there has been a material alteration of the surety
undertaking.
C. Not liable because there was a binding extension of time.
D. Liable on the surety undertaking which would include the additional 2
years.
A
If you answered C, it is wrong. After-acquired commercial tort claims are
not covered under the Revised UCC Secured Transactions Article. -
✔✔Article 9 of the UCC which governs security interests has added some
items that now are covered by security interests law. Which of the following
is true?
A. Security interests in tort claims already assessed by a court of law are
covered.
B. After-acquired commercial tort claims are covered.
C. Both the mentioned security interests and after-acquired commercial tort
claims are covered.
, D. Neither the mentioned security interests and after-acquired commercial
tort claims are covered.
C
This answer is correct. As sureties, the owners are immediately liable on
the debts if the corporation defaults. No notice need be given them. -
✔✔The Martin Corporation was a small family-owned corporation whose
owners were also the directors and officers. The corporation's bankers
insisted that if any further credit were to be extended to the corporation the
owners must guaranty payment by the corporation. This guaranty was
agreed to by the owners in writing, and an additional $50,000 loan was
granted to Martin Corporation. Which of the following best describes the
legal significance of these events?
A. The guaranty by the owners need not have been in writing since it was
primarily for their own benefit.
B. Once the owners agreed to the undertaking they automatically assumed
responsibility for all of the corporation's prior debts.
C. In the absence of specific provisions to the contrary, the owners are
immediately liable on the debt in the event of the corporation's default.
Answers 100% Solved Already Passed
B
This answer is correct because under the common law, an acceptance
must be unequivocal and unqualified, in the precise terms in which the offer
specified. The Uniform Commercial Code alters this general rule as far as
the sale of goods is concerned. An offer to buy goods for prompt shipment
is construed to invite acceptance, either by a prompt promise to ship or
prompt shipment unless the language of the offer specifically stipulates
otherwise. Peel may accept Taylor's offer by promptly promising to ship the
goods or by prompt shipment. - ✔✔Taylor signed and mailed a letter to
Peel which stated: "Ship promptly 600 dozen grade A eggs." Taylor's offer
A. May be accepted by Peel only by a prompt shipment.
B. May be accepted by Peel either by a prompt promise to ship or prompt
shipment with notice.
C. Is invalid since the price terms were omitted.
D. Is invalid since the shipping terms were omitted.
,D
This answer is correct because the leasing arrangement, to which Allen is a
surety, remained intact with no modifications. The lease, itself, expressed a
holdover clause which went into existence when Lear remained in
possession after the original leasing period. The essence of a surety
arrangement is that the surety promises to perform upon default of the
principal debtor. Therefore, Allen becomes liable when Lear defaults during
the extended term of the lease. - ✔✔Allen was the surety for the payment
of rent by Lear under a lease from Rosenthal Rentals. The lease was for 2
years. A clause in the lease stated that at the expiration of the lease, the
lessee had the privilege to renew upon 30 days' prior written notice or, if
the lessee remained in possession after its expiration, it was agreed that
the lease was to continue for 2 years more. There was a default in the
payment of rent during the extended term of the lease and Rosenthal is
suing Allen for the rent due based upon the guarantee. Allen contends that
he is liable only for the initial term of the lease and not for the extended
term. Allen is
,A. Not liable since it does not appear that a judgment against Lear has
been returned unsatisfied.
B. Not liable because there has been a material alteration of the surety
undertaking.
C. Not liable because there was a binding extension of time.
D. Liable on the surety undertaking which would include the additional 2
years.
A
If you answered C, it is wrong. After-acquired commercial tort claims are
not covered under the Revised UCC Secured Transactions Article. -
✔✔Article 9 of the UCC which governs security interests has added some
items that now are covered by security interests law. Which of the following
is true?
A. Security interests in tort claims already assessed by a court of law are
covered.
B. After-acquired commercial tort claims are covered.
C. Both the mentioned security interests and after-acquired commercial tort
claims are covered.
, D. Neither the mentioned security interests and after-acquired commercial
tort claims are covered.
C
This answer is correct. As sureties, the owners are immediately liable on
the debts if the corporation defaults. No notice need be given them. -
✔✔The Martin Corporation was a small family-owned corporation whose
owners were also the directors and officers. The corporation's bankers
insisted that if any further credit were to be extended to the corporation the
owners must guaranty payment by the corporation. This guaranty was
agreed to by the owners in writing, and an additional $50,000 loan was
granted to Martin Corporation. Which of the following best describes the
legal significance of these events?
A. The guaranty by the owners need not have been in writing since it was
primarily for their own benefit.
B. Once the owners agreed to the undertaking they automatically assumed
responsibility for all of the corporation's prior debts.
C. In the absence of specific provisions to the contrary, the owners are
immediately liable on the debt in the event of the corporation's default.
