Originally Posted by InOmaha

You have a link on the chain to take it apart (next to your finger in the photo). Toss the chain in a plastic container with a can of Coke and two cups of vinegar. Let it set in that and check it after a couple days to see how the rust is coming off.

WD-40 isn't good as a penetrant. Kroil works much better. I won't give you the recipe for the best home brew stuff for rusty stuck bolts and nuts, because it will take off the paint too.

I just worked on an old bike that had been hanging in a garage for 25-30 years. It was in a similar state and I was able to get it back on the road with elbow grease and some real bearing grease. Steel wool, fine grit sandpaper (1000-2000), and my bench mounted wire wheel cleaned it up. You'll need the tools required to tear it down to the frame and get the bearings apart.