Explain how injured parties can recover damages under the UCC.
What will be an ideal response?
Since the UCC rests on a fundamental belief in the freedom to contract, the law encourages commercial parties to decide when they enter into an agreement what remedy will be available if either side breaches. If they don't make such provisions, courts deal with any breach of contract "dispassionately," giving the injured party the financial benefit it expected under the agreement-a combination of what are known as general and incidental damages. At times, the plaintiff may also win what are called "special" or consequential damages, covering the economic costs that are a "consequence" of the breach, such as lost profits while a business is shut down because a seller failed to deliver a needed machine. But juries are not free to compensate the winner for pain and suffering, or to award punitive damages or attorneys' fees.
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Answer the following statement true (T) or false (F)
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Indicate whether the statement is true or false
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A. exploratory B. exploitative C. process D. product
Lawrence Sales Corporation offers warranties on all their electronic goods
Warranty expense is estimated at 3% of sales revenue. In 2017, the company had $603,000 in sales. In the same year, Lawrence Sales replaced defective goods with a cost of $16,500. Which of the following is the entry needed to record the replacement of the defective goods? A) Estimated Warranty Payable 16,500 Merchandise Inventory 16,500 B) Warranty Expense 16,500 Estimated Warranty Payable 16,500 C) Warranty Expense 18,090 Estimated Warranty Payable 18,090 D) Warranty Expense 18,090 Merchandise Inventory 18,090