CPCU 530 2026 NEWEST COMPLETE EXAM
QUESTIONS WITH DETAILED VERIFIED
ANSWERS (100% CORRECT ANSWERS)
/ALREADY GRADED A+
Joshua, owner of Pravait Interior Design, ordered 25 director chairs from Mellfor's
Chairs. Mellfor's did not deliver the chairs in six weeks as promised. Which one of
the following is the type of remedy to which Joshua is entitled? - CORRECT
ANSWER ✔✔- The difference between the contract price at the time the buyer
learned of the breach and the market price (If the seller fails to deliver the goods or
repudiates the contract, the buyer is entitled to the difference if any between the
contract price at the time the buyer learned of the breach and the market price)
Tammy gave Bert a personal check for purchase of his car. Bert endorsed the
check over to Larry in payment of a debt. Before Larry could cash it, Tammy
stopped payment because Bert had misrepresented the condition of the vehicle.
Neither Tammy nor Larry knew of the misrepresentation until after the check was
endorsed over to Larry. Which one of the following describes Larry's rights with
regard to this case? - CORRECT ANSWER ✔✔- Larry is entitled to the value of
the check from Tammy because Tammy's defenses are not effective against him.
(Larry is entitled to the value of the check from Tammy because Tammy's defenses
are not effective against him as Larry is a holder in due course. In other words,
Larry is free of the defenses Tammy has against a claim for payment by Bert.
Which one of the following terms applies when goods are loaded on board a vessel
at the seller's risk and expense and then ownership passes to the buyer? -
CORRECT ANSWER ✔✔- FOB vessel (FOB (free on board) vessel is used when
goods are loaded on board a vessel at the seller's risk and expense and then
ownership passes to the buyer. The other terms describe other common delivery
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,and shipping scenarios according to where goods will be delivered and which party
bears the risk and expense.
Which one of the following describes the holder in due course - CORRECT
ANSWER ✔✔- The person possessing a negotiable instrument that has been
issued for value in good faith without notice that it may not be valid (The person
possessing a negotiable instrument that has been issued for value in good faith
without notice that it may not be valid is the holder in due course.
Buyers and sellers have several options as to where goods will be delivered and
which party bears the risk and expense of delivery used in marine insurance.
Which one of the following best describes the FOB (free on board) place of
shipment? - CORRECT ANSWER ✔✔- The seller delivers goods to the carrier at
the seller's risk and expense and the ownership then shifts to the buyer.
For a creditor with a security interest to protect itself from competing third-party
claims against the collateral, the creditor must - CORRECT ANSWER ✔✔-
Obtain a perfected security interest by submitting a financing statement to the
appropriate county office or by seizing the collateral. (For a creditor with a security
interest to protect itself from competing third-party claims against the collateral,
the creditor must obtain a perfected security interest by submitting a financing
statement to the appropriate county office or court or by seizing the collateral. The
filing serves as a constructive notice to others that a security interest in the
collateral exists.
Under Article 2 of the Uniform Commercial Code (UCC), an oral contract for the
sale of goods for $500 or more is enforceable if - CORRECT ANSWER ✔✔- It
involves goods manufactured specifically for the buyer. (Under Article 2 of the
UCC, an oral contract for the sale of goods for $500 or more is enforceable if it
involves goods manufactured specifically for the buyer. Such an oral contract is
enforceable if the goods aren't suitable for resale to others in the ordinary course of
business, the seller has started manufacturing the goods to a significant degree, or
the seller has made commitments to procure the goods. Other exceptions to the
2|Page
,UCC statute of frauds: the buyer accepts and receives part of the goods or the
buyer makes partial or full payment for the goods.
The Uniform Commercial Code (UCC) Article 7 states that, to be valid, a
document of title must be issued by or addressed to - CORRECT ANSWER ✔✔-
A bailee, with the purpose of covering goods in the bailee's possession. (UCC
Article 7 states that, to be valid, a document of title must be issued by or addressed
to a bailee, with the purpose of covering goods in the bailee's possession.
During Hurricane Katrina, Jancy Cajun Cooks was unable to ship out its famous
spices to Taunton's Restaurant in Virginia. Which one of the following is an excuse
for nonperformance of this sales contract? - CORRECT ANSWER ✔✔- Failure of
a presupposed condition (Impracticality because of a failure of a presupposed
condition. A seller of goods need not complete the sale if the performance becomes
commercially impracticable. A severe shortage of materials by a natural disaster
can cause commercial impracticability.
Which one of the following chapters under the Bankruptcy Act gives individual
wage earners the same reorganization opportunities available to corporations? -
CORRECT ANSWER ✔✔- Chapter 13 (Chapter 7 is for liquidation (the 7 looks
like a key→you turn in the key), Chapter 11 is for businesses to reorganize debt,
Chapter 12 which is for farmers and fisherman is not in this course, and Chapter 13
is for individuals and small businesses to reorganize their debt.
Grace wanted to become a licensed acupuncturist. She paid $1,500 in cash for a
four-day class with her daughter, Hanna, who ran a private acupuncture training
business. With Grace's verbal permission, Hanna asked a consumer-reporting
agency for Grace's credit report. The acupuncture license that Hanna was selling to
Grace was not an offer of employment, nor was it a business license that required
an examination of Grace's financial status. Which one of the following correctly
explains whether the agency can furnish Grace's credit report to Hanna? -
CORRECT ANSWER ✔✔- The agency cannot furnish the report, under the Fair
Credit Reporting Act. (The agency cannot furnish the report, under the Fair Credit
3|Page
, Reporting Act. A consumer reporting agency can furnish a credit report only: in
response to a court order; under written instructions of the subject of the report; or,
to a person who, it has reason to believe, intends to use the information in
connection with a credit transaction, for employment purposes, in connection with
insurance underwriting, to determine eligibility for a business license if the
applicant's financial status is relevant, or for a legitimate business need for
information in connection with a business transaction.
A trade acceptance is a - CORRECT ANSWER ✔✔- Two-party draft used when a
seller wants cash immediately but when the buyer cannot provide it until the goods
are resold. (A trade acceptance is a two-party draft used when a seller wants cash
immediately but when the buyer cannot provide it until the goods are resold. The
seller (drawer) orders the buyer (drawee) to pay at some future time, with the seller
named as the payee. The seller delivers the goods to the buyer and then sells the
trade acceptance to another party at a discount to get immediate cash. The buyer
resells the goods and then pays the new holder of the trade acceptance.
Contracts for sales of goods can contain statutory warranties, as well as the sellers'
warranties, which can be express or implied. A seller's overt words or actions can -
CORRECT ANSWER ✔✔- Create an express warranty. (warranty is a promise
that something is true to specifications. Conrtacts for the sale of goods can contain
statutory warranties, as well as the seller's express or implied warranties. A seller's
overt words or actions can create an express warranty. The law may also infer the
existence of an implied warranty because of the circumstances of the sale.
In which one of the following types of secured transactions is the debtor allowed to
retain possession of the collateral property? - CORRECT ANSWER ✔✔- Chattel
mortgage and conditional sale only (he debtor is allowed to retain possession of the
collateral property through the secured transaction of chattel mortgage and
conditional sale only. With a pledge, the borrower delivers goods for the lender to
hold as security until the debt is satisfied.
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QUESTIONS WITH DETAILED VERIFIED
ANSWERS (100% CORRECT ANSWERS)
/ALREADY GRADED A+
Joshua, owner of Pravait Interior Design, ordered 25 director chairs from Mellfor's
Chairs. Mellfor's did not deliver the chairs in six weeks as promised. Which one of
the following is the type of remedy to which Joshua is entitled? - CORRECT
ANSWER ✔✔- The difference between the contract price at the time the buyer
learned of the breach and the market price (If the seller fails to deliver the goods or
repudiates the contract, the buyer is entitled to the difference if any between the
contract price at the time the buyer learned of the breach and the market price)
Tammy gave Bert a personal check for purchase of his car. Bert endorsed the
check over to Larry in payment of a debt. Before Larry could cash it, Tammy
stopped payment because Bert had misrepresented the condition of the vehicle.
Neither Tammy nor Larry knew of the misrepresentation until after the check was
endorsed over to Larry. Which one of the following describes Larry's rights with
regard to this case? - CORRECT ANSWER ✔✔- Larry is entitled to the value of
the check from Tammy because Tammy's defenses are not effective against him.
(Larry is entitled to the value of the check from Tammy because Tammy's defenses
are not effective against him as Larry is a holder in due course. In other words,
Larry is free of the defenses Tammy has against a claim for payment by Bert.
Which one of the following terms applies when goods are loaded on board a vessel
at the seller's risk and expense and then ownership passes to the buyer? -
CORRECT ANSWER ✔✔- FOB vessel (FOB (free on board) vessel is used when
goods are loaded on board a vessel at the seller's risk and expense and then
ownership passes to the buyer. The other terms describe other common delivery
1|Page
,and shipping scenarios according to where goods will be delivered and which party
bears the risk and expense.
Which one of the following describes the holder in due course - CORRECT
ANSWER ✔✔- The person possessing a negotiable instrument that has been
issued for value in good faith without notice that it may not be valid (The person
possessing a negotiable instrument that has been issued for value in good faith
without notice that it may not be valid is the holder in due course.
Buyers and sellers have several options as to where goods will be delivered and
which party bears the risk and expense of delivery used in marine insurance.
Which one of the following best describes the FOB (free on board) place of
shipment? - CORRECT ANSWER ✔✔- The seller delivers goods to the carrier at
the seller's risk and expense and the ownership then shifts to the buyer.
For a creditor with a security interest to protect itself from competing third-party
claims against the collateral, the creditor must - CORRECT ANSWER ✔✔-
Obtain a perfected security interest by submitting a financing statement to the
appropriate county office or by seizing the collateral. (For a creditor with a security
interest to protect itself from competing third-party claims against the collateral,
the creditor must obtain a perfected security interest by submitting a financing
statement to the appropriate county office or court or by seizing the collateral. The
filing serves as a constructive notice to others that a security interest in the
collateral exists.
Under Article 2 of the Uniform Commercial Code (UCC), an oral contract for the
sale of goods for $500 or more is enforceable if - CORRECT ANSWER ✔✔- It
involves goods manufactured specifically for the buyer. (Under Article 2 of the
UCC, an oral contract for the sale of goods for $500 or more is enforceable if it
involves goods manufactured specifically for the buyer. Such an oral contract is
enforceable if the goods aren't suitable for resale to others in the ordinary course of
business, the seller has started manufacturing the goods to a significant degree, or
the seller has made commitments to procure the goods. Other exceptions to the
2|Page
,UCC statute of frauds: the buyer accepts and receives part of the goods or the
buyer makes partial or full payment for the goods.
The Uniform Commercial Code (UCC) Article 7 states that, to be valid, a
document of title must be issued by or addressed to - CORRECT ANSWER ✔✔-
A bailee, with the purpose of covering goods in the bailee's possession. (UCC
Article 7 states that, to be valid, a document of title must be issued by or addressed
to a bailee, with the purpose of covering goods in the bailee's possession.
During Hurricane Katrina, Jancy Cajun Cooks was unable to ship out its famous
spices to Taunton's Restaurant in Virginia. Which one of the following is an excuse
for nonperformance of this sales contract? - CORRECT ANSWER ✔✔- Failure of
a presupposed condition (Impracticality because of a failure of a presupposed
condition. A seller of goods need not complete the sale if the performance becomes
commercially impracticable. A severe shortage of materials by a natural disaster
can cause commercial impracticability.
Which one of the following chapters under the Bankruptcy Act gives individual
wage earners the same reorganization opportunities available to corporations? -
CORRECT ANSWER ✔✔- Chapter 13 (Chapter 7 is for liquidation (the 7 looks
like a key→you turn in the key), Chapter 11 is for businesses to reorganize debt,
Chapter 12 which is for farmers and fisherman is not in this course, and Chapter 13
is for individuals and small businesses to reorganize their debt.
Grace wanted to become a licensed acupuncturist. She paid $1,500 in cash for a
four-day class with her daughter, Hanna, who ran a private acupuncture training
business. With Grace's verbal permission, Hanna asked a consumer-reporting
agency for Grace's credit report. The acupuncture license that Hanna was selling to
Grace was not an offer of employment, nor was it a business license that required
an examination of Grace's financial status. Which one of the following correctly
explains whether the agency can furnish Grace's credit report to Hanna? -
CORRECT ANSWER ✔✔- The agency cannot furnish the report, under the Fair
Credit Reporting Act. (The agency cannot furnish the report, under the Fair Credit
3|Page
, Reporting Act. A consumer reporting agency can furnish a credit report only: in
response to a court order; under written instructions of the subject of the report; or,
to a person who, it has reason to believe, intends to use the information in
connection with a credit transaction, for employment purposes, in connection with
insurance underwriting, to determine eligibility for a business license if the
applicant's financial status is relevant, or for a legitimate business need for
information in connection with a business transaction.
A trade acceptance is a - CORRECT ANSWER ✔✔- Two-party draft used when a
seller wants cash immediately but when the buyer cannot provide it until the goods
are resold. (A trade acceptance is a two-party draft used when a seller wants cash
immediately but when the buyer cannot provide it until the goods are resold. The
seller (drawer) orders the buyer (drawee) to pay at some future time, with the seller
named as the payee. The seller delivers the goods to the buyer and then sells the
trade acceptance to another party at a discount to get immediate cash. The buyer
resells the goods and then pays the new holder of the trade acceptance.
Contracts for sales of goods can contain statutory warranties, as well as the sellers'
warranties, which can be express or implied. A seller's overt words or actions can -
CORRECT ANSWER ✔✔- Create an express warranty. (warranty is a promise
that something is true to specifications. Conrtacts for the sale of goods can contain
statutory warranties, as well as the seller's express or implied warranties. A seller's
overt words or actions can create an express warranty. The law may also infer the
existence of an implied warranty because of the circumstances of the sale.
In which one of the following types of secured transactions is the debtor allowed to
retain possession of the collateral property? - CORRECT ANSWER ✔✔- Chattel
mortgage and conditional sale only (he debtor is allowed to retain possession of the
collateral property through the secured transaction of chattel mortgage and
conditional sale only. With a pledge, the borrower delivers goods for the lender to
hold as security until the debt is satisfied.
4|Page
