Question

Ethel has been in the business of manufacturing office furniture for 20 years. She writes Fred, a furniture retailer, offering to sell him 150 standard office desks for $400 each. Fred agrees and sends back the following letter confirming the deal: "We accept your offer for 150 desks at $400 each. In addition, you will provide your optional one-key desk-drawer locking accessory for each desk, which will be paid on credit." Ethel sees the added information about the option, and objects to it. What is the status of the contract?

1. No contract exists because acceptance was not the mirror image of the offer.
2. A contract was formed for the desks which also includes the locking accessory.
3. A contract is formed for the desks only.
4. A contract is formed for the desks and for the locking accessory because the parties are merchants and the contract is for the sale of goods.

Answer 1

Answer:

Correct answer is:

3. A contract is formed for the desks only.

Explanation:

Ethel manufactures office furniture and Fred is furniture retailer. Ethel's offer of 150 standard office desks for $400 each has been accepted by Fred. As such contract for desk is already formed. The additional requirement of Fred for optional one-key desk-drawer locking accessory for each desk, to be paid on credit has been objected to by Ethel.

As such contract is formed for the desks only. Option 3 is correct and other options 1, 2 and 4 are incorrect.