If an Installment Sale Contract Does Not Charge Interest on the Sale

question 4

True/False

If an installment sale contract does not charge interest on the sale of a capital asset, only capital gain will be recognized over the life of the contract.

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Definitions:

Privity of Contract

The relationship that exists between the parties involved in a contract, giving them the ability to sue each other but not allowing a third party to do so.

Manufacturer

A person or company that makes goods for sale, especially on a large scale.

Damages

Financial compensation awarded to a party in a lawsuit for loss or injury suffered due to another party's actions or negligence.

Bottle of Pop

A colloquial term referring to a sealed container filled with a carbonated soft drink.