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How does a sale differ from a gift or barter transaction?
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Commercial transaction
Portrait of King Louis XIV, by Charles Le Brun, c. 1655.
In economics and law, a sale is defined by the permanent transfer of ownership of an object from a seller to a buyer in exchange for a specific sum of money as the purchase price. This distinguishes it from other forms of asset transfers:1
- Gift: Unlike a sale, a gift is a transfer of goods without the expectation of a countervalue or payment.1
- Barter: While a sale uses money as a medium of exchange, barter involves the direct exchange of goods or services for other goods or services without an intervening monetary medium.12
The essence of a sale is the seller's intent to part with all rights to an object completely and permanently in return for a financial price. Other transfers, such as leases (for use only) or bailments (for safekeeping), do not constitute sales because they do not involve this total relinquishment of ownership.1