...| SALE OF GOODS ACT, 1930 | | | master of finance and control (Part 1) September 30, 2011 Submitted by: Nishtha Tewari-2506 Aditi Rao-2560 Jasmeet Kaur-2562 SALE OF GOODS ACT, 1930 ACKNOWLEDGEMENT We would like to extend our gratitude towards Dr. Nidhi Jain for her guidance and constant supervision as well as for providing necessary information regarding the project & also for her support in completing the project. SALE OF GOODS ACT, 1930 CONTENTS I. Contract of Sale of Goods II. Overview III. Characteristics of a Contract of Sale of Goods IV. Sale v/s Agreement to sell V. Sale v/s Hire Purchase VI. Sale v/s Contract for Work and Labor VII. Kinds of Goods VIII. Perishing of Goods IX. The Price X. Modes of Price fixing XI. Agreement to sell at Valuation XII. Earnest or Deposit XIII. Stipulations as to Time XIV. Document of Title of goods XV. Conditions and Warranties XVI. Misrepresentation and Stipulation XVII. Conditions v/s warranties XVIII. When condition can be treated as warranty XIX. Implied Conditions XX. Warranties XXI. Implied Warranties XXII. Doctrine of Caveat Emptor XXIII. Exceptions to Doctrine of Caveat Emptor HISTORY BEHIND THE ACT * Sale of Goods act is a very old mercantile law. The Contracts of Sale of Goods was initially covered in Indian Contract Act, 1872 (Chapter V11) * Since the Indian Contract Act itself was a part...
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...goods in barters or other ways in place of money. For example, if a nation’s currency is not exchangeable or no good overseas, they may offer a commodity or other product in place of cash. Countertrade was common in the USSR in the 1960s when its currency was nonconvertible. It was their only means of purchasing foreign goods. Countertrade grew in the 1980s as many other nations did not have the foreign reserves required to make imports. Countertrade increased yet again during the Asian financial crisis in 1997, as many currencies became devalued and had severely limited buying power. One example of countertrade was when the USSR paid Coca-Cola in vodka. Poland did the same with Coca-Cola but paid in beer. Countertrade can be separated into five variants: 1. Barter 2. Counter purchase 3. Offset 4. Buyback or compensation 5. Switch trading Barter is simply the direct trading of goods and or services between two parties with not monetary exchange. It is normally used in one-off deals with trading partners that are not trustworthy or that lack any credit. Barter is the simplest and most restrictive type of countertrade. Counter purchase is a mutual buying agreement which involves one party agreeing to buy a pre-specified amount of goods or services from a nation to which a sale is made. Offset is like counter purchase in that one firm agrees to buy goods with a certain percentage of the proceeds from the initial sale. The difference is that this party can conclude its transaction...
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... 1. Non-hedged foreign currency transactions (p.p.523-527)(example provided) • use two transaction approach – record transaction at spot rate (IAS 21.21) and adjust monetary asset or liability to year end spot rate through profit or loss (IAS 21.23) • foreign currency gains/losses will occur throughout the transaction 2. Speculative foreign currency positions (p.p.527-530)(example provided) • occurs when a company is essentially betting that a foreign currency will either appreciate (take a long position) or depreciate (take a short position) • since the transaction is speculative, it is by definition not hedged and hence any gains and losses will be recorded in income • If a forward exchange contract is used, both the receivable and payable to the bank will be recorded in journal entries, but will be netted against each other for financial statement presentation purposes Hedges • Used when there is both a hedged item (i.e. a receivable, payable, future cash inflow or future cash outflow) and a hedging item (forward exchange contract, offsetting loan payable or receivable) • Firms with good borrowing and investing capacity can replicate a forward exchange contract by borrowing and lending in foreign currencies – this puts limitations on how much a bank can charge for forward exchange contracts – the no arbitrage price of a forward contract = spot rate x e (Rd-Rf) where Rd=rate of return on domestic...
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...your scenario that will show how the Statute of Frauds and Parole Evidence Rule under UCC Article 2 can come into play. Article 2 of the UCC governs sales contracts, or contracts for the sale of goods. The rule is that when a UCC provision addresses a certain issue, the UCC governs; when the UCC is silent, the common law governs. Sales contracts are not governed exclusively by Article 2 of the UCC but are also governed by general contract law whenever it is relevant and has not been modified by the UCC. A sales contract is a contract for the sale of goods under which the ownership of goods is transferred from a seller to a buyer for a price. Article 2 deals with sale of goods; it does not deal with real property such as real estate, services, or intangible property such as stocks and bonds. If a dispute involves real estate or services, the common law applies. In some situations, the rules under the UCC can vary quite a bit, depending on whether the buyer or the seller is a merchant. A sale is the passing of title to property from the seller to the buyer for a price. To be characterized as a good, the item of property must be tangible, and it must be moveable. Tangible property has physical existence; it can be touched or seen. Intangible property is such as corporate stocks and bonds, patents and copyrights, and ordinary contract rights, has only conceptual existence and thus does not come under Article 2. A moveable item can be carried from place to place. Tangible property...
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...Compliant Sale Contracts © Malaysian Accounting Standards Board 2010 1 TR i-4 This Technical Release (TR) contains material in which the International Accounting Standards Committee Foundation (IASCF) holds copyright and which has been reproduced in this Statement with the permission of IASCF. Copyright in the International Financial Reporting Standards (including Interpretations), International Accounting Standards Board (IASB) Exposure Drafts, and other IASB publications belong to IASCF. All rights are reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means without the prior permission in writing to MASB or as may be expressly permitted by law or under terms agreed with the appropriate reprographics rights organisation. No part of the materials incorporated in this publication, the copyright of which is held by IASCF, may be reproduced, stored in a retrieval system or transmitted in any form or by any means without the prior permission in writing to IASCF or as may be expressly permitted by law or under terms agreed with the appropriate reprographics rights organisation. TR i-4 Shariah Compliant Sale Contracts is issued by the MASB in respect of its application in Malaysia. 2 TR i-4 CONTENTS paragraphs INTRODUCTION IN1–IN6 MASB TECHNICAL RELEASE i-4 SHARIAH COMPLIANT SALE CONTRACTS OBJECTIVE SCOPE SUBJECT OF SALE Recognition Classification Derecognition INCOME ON SALE Financing...
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...themselves informed about all of the details of their major purchases. Businesses need to conduct business practices knowing many consumers will require a full disclosure of all details before they will engage in a transaction with a business in the first place. Consumers and Businesses have rights and requirements in a purchase to detail the intentions of the transaction in writing. Both sides agree that the written agreement signed by both parties will serve as the contractual document that once carried out becomes the final agreement to the transaction. Summarized, all detail regarding the transaction should be in written form and included with the contract as part of the agreement. No verbal agreement in addition to the written contract will have any bearing on the transaction. Betty drove three hours in one- hundred degree heat. Explain whether this has any bearing on whether the dealer has to perform in accordance with the published advertisement. An advertisement for the sale of a product by a business needs to explain the item offered and the terms of the sale. Explanation of the offered item for sale in an advertisement should include special conditions that need to be met by the purchaser. A potential purchaser may experience geographical constraints with respect to how far they have to travel to pursue the purchase. In the case where a potential purchaser has traveled in extreme heat to make a purchase that would have no impact on whether the seller has to...
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...that a commercial contract is an agreement between two or more wills that creates or transfers rights and obligations of a commercial nature, an agreement of 2 or more wills on the production or transfer of rights and obligations, requiring that these wills have an outward manifestation with expressed or implied consent. Their legal nature is based on the presence of a dealer on any of the parties, due to its purpose being the industry, commerce or for the commercial mater of the object to which it refers. Article number 1794 (of the Civil Code for the Federal District) requires consent and an object in order for the contract to exist. Under articles number 1825 and 1826 the object must exist in nature, be determined or determinable and be in commerce (future objects may be subject of contracts as well). Usage and custom is defined as the result from the practice of traders so that they can become considered true law. Their uniform and continuous practice, make rules to be observed as existing law, but they cannot repeal mercantile laws themselves and be contrary to the principles of public policy. The practice is considered a source of DM autonomous and does not need the recognition of the legislator or judge, and changes to the wording of the new social needs. (Cco. Arts. 280 y 1132.) The uses are autonomous and independent provisions. They are classified into conventional (allow us to know the will of the parties in business relationships or contracts) and normative (imply...
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...Article 1458: Contract of Sale By the contract of sale one of the contracting parties obligates himself to transfer the ownership and to deliver a determinate thing, and the other to pay therefor a price certain in money or its equivalent. A contract of sale may be absolute or conditional. Essential Requisites The contract of sale, being a contract, has the same requisites, namely, consent, object, and cause. 1. Consent - Also called meeting of the minds. mutual agreement, or consensus ad idem. It essentially refers to a situation where the two parties of the contract has a mutual understanding in the formation of the contract of sale. This essentially means that there is consent in the part of the seller to transfer ownership of the determinate thing and in the part of the buyer to pay the equivalent price. Note that both of the parties must have the legal capacity to give their consent. 2. Object - This is the subject matter of the contract. It must be determinate or capable of being determinate. 3. Cause - This refers the price, in terms of money or its equivalent. Kinds of contract of sale 1. Absolute - This refers to a contract of sale that is not subject to any condition or does not require any condition for the transfer of ownership. 2. Conditional - This refers to a contract of sale that contemplates contingency, or is subject to a condition. It follows then that the delivery of the determinate thing does not necessarily transfer ownership, unless the...
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...the product name of BBA was given by BBMB to differentiate between a short term (below 12 months) and long-term (above 12 months) tenor financing products. Murabahah is for short term meanwhile BBA is for a long term financing products. 2.0 BAI’ BITHAMAN AJIL (BBA) 2.1 DEFINITION The Majallah refers to BBA as the Bai’ al Muajjal. In Pakistan the term is called Bai’ al-Muajjal, in Bangladesh it called bay’al-Muazaal. BBA means a "deferred payment sale". It is a sale contract in which the payment of the price is deferred and payable at a certain particular time in the future. It is a mode of Islamic financing used for property, vehicle, as well as financing of other consumer goods. It can be implicated in any sale contract, including Musawamah and Murabahah but it is not applicable for a Salam contract, as the payment of Salam must be settled in full at the beginning of the contract. Technically, this financing facility is based on the activities of buying and selling. The furniture that you wish to purchase for example, are bought by the bank and sold to you at an agreed to price, after the bank and you determine the tenure and the manner of the instalments. The price at which the bank sells you the furniture will include the actual cost of the furniture and will...
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...approaches to accounting for extended warranty and service contracts is most consistent with the actual substance of a sales transaction involving equipment and an extended warranty contract? Explain your selection and your reasoning fully. In our opinion, Partial Revenue Recognition approach is most consistent with the actual substance of a sales transaction involving an extended warranty contract. Using partial revenue recognition, the company can recognize partial revenue at the time of sale. We can distinguish between what is earned and what is yet to be earned. At the time of sale, the company recognized a portion of the revenue that they earned on the total sales because the warranty contract is incomplete. It recognizes the rest portion of the sale as deferred revenue and records “over the contract period” (Bruns 3). This method let the sales revenue and liabilities account to average out, which is relatively relevance and faithful representing the financial information. * Full Revenue Recognition approach had low faithful representation. Since the revenue associated with the service of the contract has not yet been completed, which means the revenue had not been earned; therefore, it was less precise to recognize it at the sale. It will understate the liability and overstates sales revenue because this method realizesfull revenue at the point of sale and adjusts later if “actual costs under the service contract fell short” (Bruns 2). Full Revenue Recognition approach...
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...well as large multinational corporations. The latter often uses these products when they expect to receive large amounts of money in the future but want to hedge their exposureto currency exchange risk. Financial instruments that fall into this category include: currency options contracts, currency swaps, forward contracts and futures contracts. Types There are three types of foreign exchange derivatives used for hedging as follows: I. Forward Hedging II. Money Market Hedging III. Option Hedging Forward Hedging It refers to the Contract to buy or sell an asset at a given price on a specific date in the future. Investors use this device to avoid major losses if the price of the asset changes dramatically before it is exchanged. Money Market Hedging It refers to the Borrowing and lending in multiple currencies, for example to eliminate currency risk by locking in the value of a foreign currency transaction in one's own country's currency. Option Hedging It refers to the right to buy or sell foreign exchange at a specified strike price in exchange of a certain option premium either at the option expiration date or during the option period. * If one acquires the right to purchase foreign exchange, it is called the call option. Buyer of the call option pays option premium & it will be the gain for the seller & the option. * If one acquires the right to sell the foreign exchange, it is called the put option. Buyer of the put option incurs put...
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...State of New Jersey ST-8 (3-07, R-11) DIVISION OF TAXATION To be completed by both owner of real property and contractor, and retained by contractor. Read instructions on back of this certificate. Do not send this form to the Division of Taxation. SALES TAX FORM ST-8 CERTIFICATE OF EXEMPT CAPITAL IMPROVEMENT A registered New Jersey contractor must collect the tax on the amount charged for labor and services under the contract unless the owner gives him a properly completed Certificate of Exempt Capital Improvement. MAY BE ISSUED ONLY BY THE OWNER OF THE REAL PROPERTY MAY NOT BE ISSUED FOR THE PURCHASE OF MATERIALS _______________________________________________________________________________________________________________ (Name of Contractor) _______________________________________________________________________________________________________________ (Address of Contractor) _______________________________________________________________________________________________________________ (Contractor’s New Jersey Certificate of Authority Number) THE FOLLOWING INFORMATION MUST BE FURNISHED: The nature of the contract is as follows (describe the exempt capital improvement to be made):______________________ __________________________________________________________________________________________________ __________________________________________________________________________________________________ _______________________________...
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...Forfeiture of Deposits Clauses in Sale and Purchase Agreement 1. Introduction There are two types of sale and purchase agreement: 1. provisional sale and purchase agreement, hereinafter the provisional agreement and, 2. formal sale and purchase agreement, hereinafter the formal agreement. The former is also called the Lum See Sale and Purchase Agreement. The latter one is also called Sale and Purchase Agreement. In Hong Kong, before signing the formal agreement, the vendor and the buyer will normally sign on a provisional agreement. Deposits will be paid during the whole transaction process. Normally there are two payments of deposits from the buyer to the vendor. The first type of the deposit is paid at the time of signing of the provisional agreement, called the initial deposit. The second type of the deposit is paid at the time of signing the formal agreement. Hereinafter, we would refer to this type of deposit as second deposit. There is no legislation in Hong Kong regulating the size of the total deposits. The deposit is a mutual agreement between the buyer and the vendor. Forfeiture clause of the deposit is usually clause under the contract which allows the vendor to forfeit the deposit. In this report, we will discuss the size of the deposit, the validity of the forfeiture clause by illustrating the principles lie behind the forfeiture of deposits through four cases. 2. Size of the Deposit In Hong Kong, most of the contracts (either provisional agreements...
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...move or sell your home or you want your family to inherit it. If you are in any doubt, seek independent advice. \\hca.local\wa\IR\Investment Delivery Partnerships team\First Buy HomeBuy\Buyers Guide\FirstBuy Buyers' Guide 040811.doc Page 2 of 21 Overview: the ‘stepping-stone’ into home ownership With FirstBuy, the buyer (‘you’) buys a new home on an approved FirstBuy new build development with assistance from both the Homes and Communities Agency (‘the Agency’) and the house builder in the form of two equity loans. You must take out a first mortgage (with a qualifying lending institution e.g. a bank or building society). This mortgage, together with any cash contribution from you, must be a minimum of 80% of the full purchase price the maximum full purchase price is set at £280,000.) The Agency and the house builder will provide equal equity loans to...
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...CUFS16 (January 2012) SALE OF GOODS LAW Businesses as well as consumers are usually free to enter into contracts on whatever terms they see fit to agree. However, contracts involving sales of goods can be subject to a range of statutory provisions. Consumers have greater protection than buyers who are ‘dealing in the course of a business’. ‘Let the buyer beware’ or ‘caveat emptor’ does not apply to all transactions and anyone selling goods in the course of a business to consumers should be aware that the law will imply certain terms into all such transactions. Consumers are defined as people who are buying for purposes not related to their trade, business or profession. 1. Legislation The Sale and Supply of Goods Act 1994 introduced significant changes to areas formerly covered by the Sale of Goods Act 1979, the Supply of Goods (Implied Terms) Act 1973, and the Supply of Goods and Services Act 1982. However, the 1979 Act, as amended, remains the bedrock of our sale of goods law. General sale of goods law is discussed in this fact sheet. Our fact sheet on Sale of Goods Law (Consumer Protection) deals with legislation that is specifically designed to protect buyers who are consumers. This includes the Unfair Terms in Consumer Contracts Regulations 1999, the Consumer Protection (Distance Selling) Regulations 2000, the Sale and Supply of Goods to Consumers Regulations 2002 and the Consumer Protection (Cancellation of Contracts Concluded away from Business...
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