In the Case of a Nonshipment Contract, Risk of Loss

question 31

Multiple Choice

In the case of a nonshipment contract, risk of loss passes to the buyer upon actual receipt of goods:

• A) only if the seller is a merchant
• B) only if the seller is a nonmerchant
• C) only if the buyer has already paid for them
• D) in all nonshipment contracts

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Definitions:

Memorandum

A written record or communication used in office or administrative support systems.

Statute of Frauds

A legal principle requiring certain types of contracts to be in writing and signed by the party to be charged, to be enforceable.

Oral Agreement

A verbal commitment between parties that is not recorded in written form but may still be legally binding.

Collateral

Assets pledged by a borrower to secure a loan or other credit, and subject to seizure on default.