1. Johnston Paints contracted in writing with Buyer to deliver 100 one-gallon cans of exterior house paint to Buyer on or before September 15. On August 15, Johnston informed Buyer via email that it will be unable to deliver the paint as agreed. Buyer demanded that Johnston perform the contract, but Johnston still refused and stated the refusal in a letter to Buyer. Which of the following best describes Buyer’s rights in this situation?

A. Buyer must treat the contract as breached on August 15.

B. Buyer must wait until September 15 to determine with certainty if there has been a breach before entering into another contract to purchase paint.

C. Buyer may treat the contract as breached on August 15 and enter into a contract with another paint supplier.

D. None of the above are correct; Buyer must file a lawsuit against Johnston so that court may determine if a breach of contract has occurred.

2. Buyer and Seller orally agree to a contract for the sale of 400 shirts at $10 per shirt. Seller fails to perform and deliver the shirts; Buyer sues. This contract is:

A. Enforceable because the Statute of Frauds does not ever apply to sales of shirts.

B. Unenforceable unless both parties are merchants.

C. Unenforceable because the contract is not in writing.

D. Enforceable; the Statute of Frauds is applicable to this agreement but oral contracts are binding if both parties are merchants.