Good Tire Company and Hiway Auto Service Enter into a Contract

question 36

Multiple Choice

Good Tire Company and Hiway Auto Service enter into a contract for a sale of tires.Good Tire is a merchant who deals in goods of the kind sold.Under the UCC,an implied warranty of merchantability arises

• A)automatically in sales contracts.
• B)only if the buyer asks for it.
• C)only if the seller does not expressly disclaim it.
• D)only in conjunction with lease contracts,not sales contracts.

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Definitions:

Average Collection Period

The average number of days it takes for a company to collect payment from its credit sales.

Common Stock

A type of corporate equity ownership, representing a portion of the stake in a company.

Market Price

The current price at which an asset or service can be bought or sold in a particular market.

Accounts Receivable Turnover

A financial ratio indicating how many times a company's receivables are turned into cash within a specific period.