Kathleen is thinking about petitioning for bankruptcy. Before doing so, she sells her prize stallion that is worth $10,000 to Julia for $100 with the understanding that Julia will sell the stallion back for the same price in the future. The sale of the stallion is an example of a(n)

A) illegal sale
B) fraudulent transfer.
C) bankruptcy transfer.
D) liquidation.

Fraudulent Transfer

A transaction where a debtor intentionally transfers assets to avoid creditors' claims.

Prize Stallion

A highly valued male horse recognized for its pedigree, performance, or breeding capabilities.

Bankruptcy

A legal proceeding involving a person or business that is unable to repay outstanding debts, allowing for the liquidation or reorganization of assets to pay creditors.