Looks as if anything that could rust has rusted. WD40 is better than nothing. Guessing that you need a new chain. The freewheel cogs are quite rusty.
Does the seat post move side to side but not up? That would be better than not moving at all but still a problem if you can't pull it up.
Appears you have a rear U-brake.
$10 is a great price in spite of any evident problems.
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Bacchetta Giro A20, RANS V-Rex, RANS Screamer