A Homeowner Orally Contracted to Buy Some Custom-Made Parts That

question 47

Multiple Choice

A homeowner orally contracted to buy some custom-made parts that the homeowner will use to build a retaining wall in the homeowner's back yard.The contract price for these materials was $2,000.The buyer refused to take delivery even though the materials were conforming.The seller is unable to sell these parts to anyone else because they were individually designed for the homeowner.In a lawsuit against the homeowner by the seller of the parts,which of the following is true?

• A) The UCC would not apply because these goods will become real property when installed by the homeowner.
• B) This contract is not enforceable because the price is $500 or more.
• C) This contract is not enforceable,assuming that the homeowner is not a merchant in the materials purchased.
• D) This contract is fully enforceable even though it is not in writing.

---

Definitions:

Owner Invests

occurs when the owner of a business contributes assets, commonly in the form of cash or equipment, into the business for its use.

Retained Earnings

The portion of a company's profits that is kept or retained and not paid out as dividends to shareholders, often used for reinvestment.

Revenue

Income generated from normal business operations and includes discounts and deductions for returned merchandise.

Accounts Payable

Liabilities of a business that represent amounts owed to creditors for goods and services received but not yet paid for.