A Due-On-Sale Clause in a Loan Contract Prohibits the Buyer

question 107

True/False

A due-on-sale clause in a loan contract prohibits the buyer of a business from assuming a seller's loan even though it may carry a lower interest rate.

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Definitions:

Warranty Costs

Expenses incurred by a company to repair, replace, or refund products that are found to be defective within a warranty period.

Two-Year Warranty

A guarantee provided by a seller or manufacturer to repair or replace defective goods for two years after purchase.

Tablet Computers

Tablet computers are portable, thin electronic devices equipped with a touchscreen interface, offering a combination of computing, internet, and multimedia capabilities.

Estimated Warranty Expense

A projected cost that a company expects to incur for repairing or replacing products under warranty.