Astrid Borrowed $500 000 from Bartholomew

question 66

Multiple Choice

Astrid borrowed $500 000 from Bartholomew. As security for the repayment of that loan, she created a mortgage over a piece of land called Blackacre. That mortgage was immediately registered. Which of the following statements is TRUE?

• A) If Astrid sells Blackacre to Elsa, Bartholomew will no longer be able to enforce any proprietary rights against the land, but he will still be able to demand repayment of the loan from Astrid.
• B) If Astrid defaults on the mortgage, and Bartholomew uses the remedy of judicial sale to sell Blackacre for $750 000, then the amount that he is entitled to receive may be somewhat greater than the value of the money that Astrid failed to repay on the loan.
• C) Because of the rules regarding the equity of redemption, Bartholomew is entitled to assign to a third party the contractual right to demand repayment of the loan from Astrid, but Bartholomew cannot transfer to a third party the proprietary rights that the mortgage created with respect to Blackacre.
• D) If Astrid sells Blackacre to Elsa, Bartholomew will no longer be able to demand repayment of the loan from Astrid.
• E) Another party can acquire all of Bartholomew's rights if Bartholomew simply creates a contractual assignment.

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Definitions:

Fixed Manufacturing Overhead

Indirect production costs that remain constant, regardless of the level of production output, such as salaries or rent.

Direct Labor-Hours

An accounting metric denoting the hours worked by employees directly involved in manufacturing goods or providing services, crucial for cost allocation and pricing.

Unused Capacity

Available but not currently utilized production or service capacity within a business.

Fixed Manufacturing Overhead

Costs associated with manufacturing that do not vary with the level of production, such as rent, salaries, and insurance.