Question

A department store buyer and a manufacturer of food processors entered into a written contract whereby the manufacturer would sell to the buyer 50 of its top-of-the-line models for $100 each. When the delivery arrived on May 15, several days early, the buyer noticed that the food processors were a different model that did not have all of the features as the top-of-the-line model that was ordered. The buyer contacted the manufacturer and told him that he was rejecting the food processors that were delivered to him and expected the manufacturer to send 50 top-of-the-line models immediately. The manufacturer replied that because of a backlog of orders that had not yet been filled, the top-of-the-line models could not be delivered until August 15. Because the department store had contracted with a restaurant to deliver three top-of-the-line models by May 31, the buyer delivered three of the nonconforming food processors along with a promise to replace them with three top-of-the-line models in mid-August. The buyer returned the remaining food processors to the manufacturer.
How much could the department store recover from the manufacturer for the three food processors that it delivered to the restaurant?

A) Nothing, b/c they were resold to another.

B) Nothing, b/c it accepted them knowing they were defective.

C) The difference b/t the market price of the top-of-the-line models and the existing food processors' actual value.

D) The difference b/t the existing food processors' actual value and the cost of the food processors that the department store must provide to the restaurant in mid-August.

Answer 1

Answer: C. The difference b/t the market price of the top-of-the-line models and the existing food processors' actual value

Explanation:

Based on the information given, the amount that the department store will recover from the manufacturer for the three food processors that it delivered to the restaurant will be the difference between the market price of the top-of-the-line models and the existing food processors' actual value.