Marco and Fred Enter into a Contract for the Sale

question 50

Multiple Choice

Marco and Fred enter into a contract for the sale of Marco's apartment for which Fred agrees to pay him $100,000.Marco cannot prohibit Fred from transfering his right to the ownership of the apartment because such a prohibition is

• A)against public policy.
• B)immoral.
• C)unconscionable.
• D)a crime.

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Definitions:

Capital Lease

A long-term lease agreement that designates the lessee (the person who rents the asset) as having the financial responsibilities and benefits of ownership.

Long-Term Asset

A long-term asset is an asset that is not expected to be converted into cash within a year and is used over a long period, such as property, plant, and equipment.

Intangible Asset

An asset that lacks physical substance and usually is very hard to evaluate, such as patents, trademarks, and copyrights.