REG Study Group Q4 2014 - Page 240

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  • #632792
    WANNABE_CPA
    Member

    13.D ?

    FAR : 68, 74, 83 Thank you God 🙂
    BEC : 78 (8/27) 🙂
    REG : 72 ,80 (2/25) 🙂
    AUD : 69,67, 07/23

    #632793
    MommyBear
    Member

    I don't like that “future goods” part of A because it makes me think it contradicts with them having “rights” to the goods. I'm going with B for 13.

    #632794
    Anonymous
    Inactive

    13 is D – Usually, the first security interest to be perfected has top priority. There is an exception, though, for a purchase money security interest, or a purchase money security interest. A purchase money security interest in noninventory collateral has priority if it is perfected before the debtor takes possession or within 20 days thereafter.

    #632795
    MommyBear
    Member

    14–An appliance seller promised a restaurant owner that a home dishwasher would fulfill the dishwashing requirements of a large restaurant. The dishwasher was purchased but it was not powerful enough for the restaurant. Under the Sales Article of the U.C.C., what warranty was violated?

    A.

    The implied warranty of marketability

    B.

    The implied warranty of merchantability

    C.

    The express warranty that the goods conform to the seller's promise

    D.

    The express warranty against infringement

    #632796
    Anonymous
    Inactive

    More exceptions for priorities for security interests!

    #632797
    SomedayCPA2015
    Participant

    Great quiz everyone! I'll be coming back to go through them this afternoon. My best friend is in town from Germany and I promised her 2 hours to hang out, so off I go. 🙂 Good luck!

    REG - Passed
    BEC - Passed
    AUD - Passed
    FAR - Passed!!!! I have my life back.

    #632798
    MommyBear
    Member

    They should have a subsection for blaw and for tax that is just “exceptions”. *sigh*

    #632799
    Anonymous
    Inactive

    14 – B?

    #632800
    MommyBear
    Member

    14 is C

    This deals with U.C.C. 2-312, which discusses and defines an Express Warranty as a seller's oral or written promise, ancillary to an underlying sales or lease agreement, as to the quality, description, or performance of the goods being sold or leased. Under the U.C.C., express warranties arise when a seller indicates to the buyer/lessee that the goods:

    conform to any affirmation or promise of fact made by the seller to the buyer/lessee about the goods (i.e., there is a “dual core” processor in the machine),

    conform to any factual description of the goods (i.e., the label says it is an Intel processor), and/or

    conform to any sample or model of the goods shown to the buyer prior to purchase.

    In order to give rise to an express warranty, the affirmation, promise, description, sample, or model must become part of the basis of the bargain between the seller and the buyer and constitute more than a mere statement of opinion. These warranties can be found in a seller's advertisement, brochure or other promotional materials, as well as being made orally or expressly in a written contract. To be an express warranty, the seller does not have to specifically say “warrant” or guarantee. Rather, the buyer must have reasonably understood a representation as part of the basis of the bargain. For example, “in good mechanical condition” is presumptively part of the bargain and is held to be a warranty. A statement of opinion and value is not always easy to separate. Puffing is always around: “This is the best used car to come around in years; it has four new tires and a 150-horsepower engine rebuilt this year.” You only have a case for the tires and the engine in this situation. A statement that something is “worth a fortune” or “you'd pay $500 elsewhere” does not usually create a warranty.

    #632801
    Anonymous
    Inactive

    15–A debtor is in default. The collateral consists of 100 cows described in the security agreement. Thirty cows were stolen through no fault of the debtor. Which of the following statements is correct concerning the secured party's rights due to the debtor's default?

    A. The secured party must take the peaceful possession of the 70 remaining cows before s/he can pursue any remedies.

    B. If the secured party takes possession, the secured party cannot keep the cows in full satisfaction of the debt, if the debtor has paid 60% or more of the debt.

    C. If the secured party takes possession and sells the 70 cows. Proceeds will be applied to expenses incurred in the keeping of the cows. The costs of sale, and any balance, will be applied to the debt. The debt will then be discharged, even if the proceeds are insufficient to cover the costs and the debt.

    D. Upon default, the secured party can proceed to recover under the Uniform Commercial Code or proceed with any judicial remedy (such as get a judgment and levy on the debtor's non-exempt property).

    #632802
    WANNABE_CPA
    Member

    for 13, PMSI is always on top after goods bought in ordinary course of business.

    FAR : 68, 74, 83 Thank you God 🙂
    BEC : 78 (8/27) 🙂
    REG : 72 ,80 (2/25) 🙂
    AUD : 69,67, 07/23

    #632803
    MommyBear
    Member

    16-On July 8, Ace, a refrigerator wholesaler, purchased 50 refrigerators. This comprised Ace’s entire inven­tory and was financed under an agreement with Rome Bank that gave Rome a security interest in all refrigerators on Ace’s premises, all future-acquired refrigerators, and the proceeds of sales. On July 12, Rome filed a financing statement that adequately identified the collateral. On August 15, Ace sold one refrigerator to Cray for personal use and four refrigerators to Zone Co. for its business. Which of the following statements is correct?

    A.

    The refrigerators sold to Zone will be subject to Rome’s security interest.

    B.

    The refrigerator sold to Cray will not be subject to Rome’s security interest.

    C.

    The security interest does not include the proceeds from the sale of the refrigerators to Zone.

    D.

    The security interest may not cover after-acquired property even if the parties agree.

    #632804
    Anonymous
    Inactive
    #632805
    WANNABE_CPA
    Member

    15. C?

    FAR : 68, 74, 83 Thank you God 🙂
    BEC : 78 (8/27) 🙂
    REG : 72 ,80 (2/25) 🙂
    AUD : 69,67, 07/23

    #632806
    Anonymous
    Inactive

    16-B?

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