S sold a specific laptop to B at an instalment price of P100,000 payable in ten equal monthly instalments. In order to secure the payment of the instalment price, B chattel mortgaged the said laptop S with stipulation that in case of deficiency from the foreclosure of the chattel mortgage, S may recover the deficiency from B. It was also stipulated that in case of cancellation of the sale, all instalments received by S from B will be forfeited in favor of S. After religious payment of six monthly instalments, B defaulted in the remaining instalments,
S sold a specific laptop to B at an instalment price of P100,000 payable in ten equal monthly instalments. In order to secure the payment of the instalment price, B chattel mortgaged the said laptop S with stipulation that in case of deficiency from the foreclosure of the chattel mortgage, S may recover the deficiency from B. It was also stipulated that in case of cancellation of the sale, all instalments received by S from B will be forfeited in favor of S. After religious payment of six monthly instalments, B defaulted in the remaining instalments,
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
54. S sold a specific laptop to B at an instalment price of P100,000 payable in ten equal monthly instalments. In order to secure the payment of the instalment price, B chattel mortgaged the said laptop S with stipulation that in case of deficiency from the foreclosure of the chattel mortgage, S may recover the deficiency from B. It was also stipulated that in case of cancellation of the sale, all instalments received by S from B will be forfeited in favor of S. After religious payment of six monthly instalments, B defaulted in the remaining instalments, which is correct?
Group of answer choices
a. S cannot file an action for exact fulfilment of obligation against B because that remedy is available only if the buyer defaulted in one instalment.
b. If S cancels the sale, he cannot go after the buyer for the balance of the instalment price of the laptop.
c. If S forecloses the chattel mortgage on the laptop, S may recovery any deficiency from the foreclosure sale because of the principle of autonomy of contract.
d. If S cancels the sale, he may ask for the return of laptop from B and he may forfeit all the six monthly instalments he collected from B even if such agreement is unconscionable because of the principle of autonomy of contract.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education