Business - Business Law. Pre Quiz 5

1

To help eliminate conflicts of interest, Sarbanes-Oxley prohibits all the following activities by audit firms for their clients, except: ______

2

The definition of a default judgment is:

3

It is the motive behind the intent—not the intent—that is important in tort law.

4

Churning is the practice of encouraging investors to make multiple unnecessary trades in order to create extra income for the broker. Because it benefits a few at the expense of the many, churning violates the utility principle

5

Mulligan Domestics Co breached a contract by refusing to accept its order for 60 bolts of fabric from Wellington Mills, although the fabric met the contract specifications. Wellington:

6

The Securities Exchange Act of 1934 regulates the ________

7

The United States Constitution is:

8

Which of the following types of contracts cannot be either contradicted or supplemented by evidence of prior agreements or expressions?

9

Ewing's of Dallas placed a $10,000 order for dresses, F.O.B. Dallas from Marvelous Manufacturing Co in New York, for their October 1 Fall Showing. The dresses were to be shipped at a cost of $300 to the seller. In New York, Marvelous dresses were the

10

Jane signs an instrument using a “J” with a swirl around it. With this mark for a signature, the instrument is

11

List the four different kinds of bailments.

12

A superseding cause is an intervening event that imposes liability on a defendant for injuries caused by the intervening event.

13

Strict liability is imposed for reasons other than fault.

14

What are the exceptions to the warrant requirement?

15

Which of the following describes a stipulation?

16

Whether an implied warranty arises out of the circumstances under which the parties enter into a contract may depend on:

17

Prime meridians are placed every 24 miles

18

Jody, a consumer, ordered a computer from Dwindex Technologies. After Jody validly rejected the computer due to its nonconformity to the contract, Dwindex insisted that Jody return it. Jody refused, and instead just held the computer for Dwindex to retrieve it. Is Jody obligated to return the computer?

19

All shares authorized by the corporation's articles of incorporation must be issued and sold to shareholders immediately

20

Built-in cabinets in a house would be considered as permanent parts of the real property

21

A bank has no right to charge a customer's account for the amount of a stale check.

22

Because of the recent burglary of the store, did the employer have a legitimate business reason to record and review the employee's phone calls made or received while at work?

23

Sandra and Joe own a hobby farm as tenants in common. They also own a vacation home as joint tenants. What is the difference between the tenancy in common and joint tenancy?

24

Enrico leaves his Ford sport utility vehicle at Gordo's Auto Service for an oil change. This is

25

When there is a direct conflict between a federal and a state law, the state law is rendered invalid.

26

Making your rules assuming you don't know which side you will be on in any given dilemma is the Theory of Justice

27

Which of the following is not considered when determining a reasonable time in which a demand instrument is due?

28

The National Association of Realtors' 2009 settlement with the Justice Department: A) Requires NAR to accept all licensed brokers and agents as members

29

Because she is a minor, Sarah cannot enter into contracts on her own behalf although she is perfectly competent. Her mother wishes to make Sarah an agent of the family business, and Sarah will be responsible for entering into contracts as an agent. Can Sarah act as an agent of the company?

30

Under the UPA, a partner in a tenancy in partnership has all the following rights except:

31

Which of the following is a term for laws that limit the types of business activities in which parties may legally engage on Sundays?

32

Most courts hold that when a customer takes an item from the shelf in a self-service store, there is:

33

The transfer of rights under a nonnegotiable contract is known as an assignment

34

Which of the following is an equitable doctrine that protects those who foreseeably and reasonably rely on the promises of others by enforcing such promises when enforcement is necessary to avoid injustice, even though one or more of the elements normally required for an enforceable agreement is absent?

35

Belinda was hired as a security expert for a local accounting firm. She looks through the different policies and concludes that her new accounting firm needs a[n] ________ liability insurance policy to protect the company because they do business in the cloud.

36

The_________on corporations and on individuals is the most important single source of revenue for the federal government

37

The Federal Trade Commission regulates:

38

Robert S. Custer owns approximately 97 acres in Cumberland Valley Township, Bedford County, where he operates a nursery business. In March 2001, Custer purchased a used greenhouse for $1,500,disassembled it, transported it by flatbed pickup truck to his

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property, where he stored it until May 2004, and then reassembled it. The greenhouse is an arch-shaped structure that is 30 feet by 96 feet in size, and is approximately 12 feet high at its highest point. The greenhouse is constructed by 24 vertical pipes on each side. These vertical pipes are inserted two feet into the ground and are connected at the top to arch-shaped pipes. Plastic covering is attached to the arching pipes and serves as a covering for the structure. Because of the addition of the greenhouse to the property, the Board increased the assessed value of the buildings on Custer's property for the 2004 tax year from $11,124 to $19,978, an increase of $8,854. Custer appealed to the Board contending that the greenhouse should not be assessed because it was not real estate. Evaluate whether the greenhouse is a fixture, and properly included in the assessment, or personal property. Be sure to consider whether the fact that it is the assessor makes a difference in your evaluation.

Chattels used in connection with real estate are of three classes: First, those which are manifestly furniture, as distinguished from improvements and not peculiarly fitted to the property with which they are used; these always remain personalty ...Second, those which are so annexed to the property that they cannot be removed without material injury to the real estate or to themselves; these are realty, even in the face of an expressed intention that they should be considered personalty.... Third, those which, although physically connected with the real estate, are so affixed as to be removable without destroying or materially injuring the chattels themselves, or the property to which they are annexed; these become part of the realty or remain personalty, depending upon the intention of the parties at the time of the annexation; in this class fall such chattels as boilers and machinery affixed for the use of an owner or tenant, but readily removable.
The green house creates the necessary environment for raising plants and will be affixed to the property until it is worn out, the nursery business fails, or Custer and his wife no longer occupy the property.... [T]he green house is realty and taxable as real estate.

In assessment cases, the assessor tends to win because the value of the property is increased by less-than-permanent attachment that are integral to the property. In a sales transaction, it is possible that the portable greenhouse would not be included. The same would be true if the nursery owner had been merely a tenant on the land - probably would have been a trade fixture only.

39

Constructive fraud may be found when an accountant is grossly negligent in performing his or her duties

40

What uniform disclosures to consumers are required under the Truth-in-Lending Act and Regulation Z, and what is the rationale for these uniform disclosures?

The Truth-in-Lending Act and Regulation Z require a creditor to disclose the following information to the consumer-debtor:

•	Cash price of the product or service

•	Down payment and trade-in allowance

•	Unpaid cash price

•	Finance charge, including interest, points, and other fees paid for the extension of credit

•	Annual percentage rate (APR) of the finance charges

•	Charges not included in the finance charge (such as appraisal fees)

•	Total dollar amount financed

•	Date the finance charge begins to accrue

•	Number, amounts, and due dates of payments

•	Description of any security interest

•	Penalties to be assessed for delinquent payments and late charges

•	Prepayment penalties

•	Comparative costs of credit (optional)

The rationale behind these uniform disclosures is that they will help consumers shop for the best credit terms.

41

Title VII has been successfully used to challenge English-only workplace rules

42

Answer the following questions true (T) or false (F)

43

The second level of courts in the federal court system is made up of the U.S. ________

44

[Car Repair] Gordon and Leo are partners in SafeT Car, a full service automotive repair company. Leo does nearly all of the day-to-day work as Gordon is thinking about retiring. When Leo was moving a customer's car last week, he accidentally collided with the garage door, and the door had to be replaced at a cost of $6,000. Leo recently met with BigBox stores about a potential deal by which BigBox would set up a SafeT Car shop in every BigBox store nationwide. Leo signed an agreement to open a "test" store in one BigBox store. Leo hasn't told Gordon yet, because Gordon hasn't been in the office in a month. Gordon opens The Oil Place, an express oil change company, which he plans to have his sons operate in his retirement. When Leo learns about The Oil Place, he threatens to sue Gordon for

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breach of duty because Leo is sick of doing all the work at SafeT Car while Gordon was apparently opening a competing business. Gordon tells Leo that he hasn't breached any duty and they don't have a written agreement that restricts Gordon from opening his own store with his sons. Gordon also tells Leo that the $6,000 for the damaged door is coming out of Leo's pocket. Leo, who's thinking about the potential deal about BigBox, tells Gordon he wants to split up the partnership.Does Leo have any obligation to tell Gordon about the BigBox deal?

A. Yes, partners must disclose any material facts affecting the business.
B. No, because Gordon breached his fiduciary duty.
C. No, because Gordon has chosen not to come to work and not to perform any duties.
D. Yes, but Leo only has to tell Gordon about the BigBox deal if they are going to split up the business.
E. No, although partners must disclose any material facts affecting the business, Leo does not need to tell Gordon unless he signs an agreement to place SafeT Car in every BigBox store nationwide.

45

A forum-selection clause forbids parties to a contract to designate and agree to the jurisdiction of a court that otherwise might not have personal jurisdiction

46

Once an escrow is opened, it cannot be cancelled

47

Sonja ran her car over Hank in her company parking lot, breaking his leg. The accident occurred because Sonja's car brakes failed without warning. Hank sues Sonja. Sonja decides to do nothing because she sees no way that she can win the lawsuit since she did strike Hank. Is she right? Why or why not? What would you suggest that she do in the civil litigation? Why is it important that Sonja proceed correctly and in a timely manner at this point in the litigation?

48

A contract that has been fully performed by both sides is called a(n) ________ contract.

49

If, upon dissolution of a partnership, one partner pays liabilities of the partnership that are greater than the liquidated assets of the partnership, which of the following is true?

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Business - Business Law. Pre Quiz 5

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