[FabCPA]

NINJA Question –

I’m working the sales contract section and i ran into this question that got me all confused.

I chose B but the answer says it’s D, could someone explain why? I’m thinking this may be a mistake but I’m not sure.

On Day 1, Jackson, a merchant, mailed Sands a signed letter that contained an offer to sell Sands 500 electric fans at $10 per fan. The letter was received by Sands on Day 3. The letter contained a promise not to revoke the offer but no expiration date. On Day 4, Jackson mailed Sands a revocation of the offer to sell the fans. Sands received the revocation on Day 6. On Day 7, Sands mailed Jackson an acceptance of the offer. Jackson received the acceptance on Day 9. Under the Sales Article of the U.C.C., was a contract formed?

A. No contract was formed because the offer failed to state an expiration date.

B. No contract was formed because Sands received the revocation of the offer before Sands accepted the offer.

C. A contract was formed on the day Jackson received Sands’ acceptance.

D. A contract was formed on the day Sands mailed the acceptance to Jackson.

The correct answer is D.

The contract was formed because Jackson made an offer to sell fans to Sands and made a promise not to revoke the offer. Since the promise not to revoke did not contain an expiration date, then the offer remains open for a reasonable time. Jackson mailed an acceptance of the offer four days after receiving it. A contract was formed since four days was a reasonable time for the offer to remain open.

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So the answer says Jackson accepted the offer but Jackson was the one who made the offer and therefore he was the seller. It was Jackson who sent a revocation letter on the fourth day and Sands who was the buyer received the revocation on day 6, the day before he accepted and mailed the offer.

So since Sands received the revocation letter before accepting the offer, the contract could have not been formed.

Someone please help! Am I correct or is D the correct answer.

Why can't NASBA IP the difference between a 74 and a 75??????