ACCT 215 EXAM 3 IOWA STATE 157 QUESTIONS WITH
COMPLETE SOLUTIONS.
*Statute of Frauds Answer - Certain contracts have to be in writing to be
enforceable in court.
• must be signed by the opposing party against whom the contract is being
enforced.
*Wright vs. Wright Answer - • plaintiff gives birth to son
• defendant's son was the father
• defendant agrees to pay plaintiff if she will marry his son and the son leaves
her
• son leaves plaintiff and child
• defendant argues he should not have to pay plaintiff because there was no
consideration and this type of contract violates public policy
• court disagrees and holds for plaintiff
*Contracts subject to Statute of Fraud Answer - • interests in land or anything
permanently attached to land
• contracts that cannot be performed within one year from date of
formation**
• surety contracts (gratuitous guarantors only)
• promises made in consideration of marriage
• contracts for goods priced $500 or more
,*Promises to pay for debt of another.. Answer - Has to be in writing if you
don't get an economic benefit
*Exceptions to statute of Frauds Answer - • Common Law
- partial performance
- promissory estoppel
• UCC
- Admission in court
- acceptance (or partial acceptance) of goods costing $500 or more
- specially manufactured goods
*Parole Evidence Rule Answer - • applies to written contract, court doesn't
care about the negotiation leading up to the contract being made.
• Exceptions:
- subsequent Modification
- Ambiguous terms
Parole Evidence Answer - • course of performance
• course of dealings
• usage of trade
Course of performance (P E) Answer - court looks how the parties have been
interpreting the contract terms to date as they have performed under the
contract
Course of dealings (P E) Answer - court looks at how parties in question have
transacted in the past and interpreted similar terms
, Usage of trade Answer - how do others involved in the trade in question
interpret terms such as those in dispute
Consent Answer - parties cannot enter into an agreement if they have not
consented to the terms of the agreement because they were mistaken, tricked
or threatened
*Mistakes Answer - • mistake of law is not an excuse
• mistake of value
- courts generally don't care about this type of mistake
• mistake of fact
- bilateral mistakes
• both parties mistaken
• cannot have a meeting of the minds
*Bilateral Mistakes Answer - Both parties are mistaken
*Unilateral Mistake Answer - • only one party makes a mistake
- must be material
- courts not interested in unilateral mistakes
• 2 Exceptions**
- one party knows/ should have known the other party is mistaken
- mathematical or bookkeeping errors
*Aydin Corp vs. US Answer - • NAVALEX solicited orders for radio sets
• Aydin submits a bid for $158,800 per radio
• plaintiff learns of competitor's higher bid
COMPLETE SOLUTIONS.
*Statute of Frauds Answer - Certain contracts have to be in writing to be
enforceable in court.
• must be signed by the opposing party against whom the contract is being
enforced.
*Wright vs. Wright Answer - • plaintiff gives birth to son
• defendant's son was the father
• defendant agrees to pay plaintiff if she will marry his son and the son leaves
her
• son leaves plaintiff and child
• defendant argues he should not have to pay plaintiff because there was no
consideration and this type of contract violates public policy
• court disagrees and holds for plaintiff
*Contracts subject to Statute of Fraud Answer - • interests in land or anything
permanently attached to land
• contracts that cannot be performed within one year from date of
formation**
• surety contracts (gratuitous guarantors only)
• promises made in consideration of marriage
• contracts for goods priced $500 or more
,*Promises to pay for debt of another.. Answer - Has to be in writing if you
don't get an economic benefit
*Exceptions to statute of Frauds Answer - • Common Law
- partial performance
- promissory estoppel
• UCC
- Admission in court
- acceptance (or partial acceptance) of goods costing $500 or more
- specially manufactured goods
*Parole Evidence Rule Answer - • applies to written contract, court doesn't
care about the negotiation leading up to the contract being made.
• Exceptions:
- subsequent Modification
- Ambiguous terms
Parole Evidence Answer - • course of performance
• course of dealings
• usage of trade
Course of performance (P E) Answer - court looks how the parties have been
interpreting the contract terms to date as they have performed under the
contract
Course of dealings (P E) Answer - court looks at how parties in question have
transacted in the past and interpreted similar terms
, Usage of trade Answer - how do others involved in the trade in question
interpret terms such as those in dispute
Consent Answer - parties cannot enter into an agreement if they have not
consented to the terms of the agreement because they were mistaken, tricked
or threatened
*Mistakes Answer - • mistake of law is not an excuse
• mistake of value
- courts generally don't care about this type of mistake
• mistake of fact
- bilateral mistakes
• both parties mistaken
• cannot have a meeting of the minds
*Bilateral Mistakes Answer - Both parties are mistaken
*Unilateral Mistake Answer - • only one party makes a mistake
- must be material
- courts not interested in unilateral mistakes
• 2 Exceptions**
- one party knows/ should have known the other party is mistaken
- mathematical or bookkeeping errors
*Aydin Corp vs. US Answer - • NAVALEX solicited orders for radio sets
• Aydin submits a bid for $158,800 per radio
• plaintiff learns of competitor's higher bid
