Asked by Sakina Pervez on May 09, 2024
Verified
A bicycle manufacturer sells 100 bikes to Bill's Bike Shop.The contract says that Bill's may return any bike not sold within six months and be reimbursed for them.Bill's Bike Shop burns down one week after the delivery of the bikes,which are destroyed in the fire.Bill's bears the risk of loss for the 100 bikes.
Risk of Loss
The potential for an asset to decrease in value or for a financial loss to occur in a transaction.
Reimbursed
Repaid or compensated for expenses or losses incurred.
Contract
An agreement legally recognized and enforceable, made between two or more parties.
- Comprehend the significance of risk of loss provisions and how they apply in different scenarios.
Verified Answer
JM
Jessica MitchellMay 15, 2024
Final Answer :
True
Explanation :
In general,any risk passes on to the buyer on receipt of the goods if the seller is a merchant.
Learning Objectives
- Comprehend the significance of risk of loss provisions and how they apply in different scenarios.