Final Examination - Real Estate License

Last updated about 1 year ago

100 questions

1

Library

Final Examination - Real Estate License

Last updated about 1 year ago

100 questions

1

John Wilson has developed a 60-lot subdivision and has buit ten homes for sale. This type building is called

tract

custom

ranch

planned unit development

Part II of Chapter 475 applies to

the Florida Real Estate Commission

the Florida Real Estate Appraisal Board

liens for commissions on property sale proceeds

liens for comissions on leasing property

Which is correct about the Florida Real Estate Commission?

It regulates the practice of real estate by brokers, sales associates, and appraisers

It is a police agency

Its rules provide greater detail than Chapter 475, F.S

It can fine persons who practice real estate without a license 

Which is NOT a requirement for a real estate license in Florida?

Be at least 18 years old

Be at least 21 years old

Have a U.S Social Security number

Hold a high school diploma or its equivalent

If a broker wants to close his sole proprietorship and sell property for another broker, he

may have an inactive broker associate's license.

must keep an active broker's license if he is to recieve commissions.

must be registered as a broker associate if he is to recieve commissions.

must surrender his broker's license for cancellation

Florida has agreements with certain other states that allows licensees who are residents of those states to become licensed in Florida by passing a

40-question exam on Florida law

100-question exam on Florida law

63-hour slaes associate course

FREC-approved 14-hour continuing education course

Which individual needs a Florida real estate license?

A real estate auctioneer

A cemetary lot salesperson

A state-certified real estate appraiser when making appraisals

A cour-appointed person

A sales associate passed her state exam on June 17, 2025. Her license will expire on

June 17, 2027

June 30, 2027

March 31, 2027

September 30, 2027

A sales associate's license expired last year in April. This year in September, she wants to renew her license for the third time. She must pay a late fee, pay the renewal fee, and complete

14-hours of continuing education

28-hour of reactiviation education

a 45-hour sales associate sales post-licensing course

a 63-hour sales associate course

Broker Wilson is working with buyers to find a suitable property. He has given them a no brokerage relationship notice. He does NOT have the duty to

present all offers

deal honestly and fairly

disclose all known facts that would materially affect the value of the property

account for all funds

If Broker Jones wants to provide limited representation to both parties in a real estate transaction, he can be a

single agent

nonrepresentative

transactional broker

dual agent

Broker Sam is a single agent for a buyer. Which is NOT a requirement of this type of relationship?

loyal

trustworthy

caveat emptor

confidential

Wally is a single agent real estate broker who lists the Smith's house. Wally later works with a buyer who wants to purchase the Smith's house. What are Wally's options?

Become the buyer's transaction broker

Become a dual agent and represent each party equally and fairly

Continue as a designated sales associate for each party

Transition to transation broker status

What is the brokerage relationship reserved for nonresidential transactions only?

single agent

transaction broker

dual agent

designated sales associate

Broker William is a single agent for Seller Mary. William may NOT

obey Mary's legal instructions about the listing

present offers to Mary that don't have earnest money deposists

be a transation broker for a buy of Mary's property

be loyal only to Mary in the transaction 

When Broker Alice enters in to a no brokerage relationship with buyer Jamal, she must

explain her duties to Jamal

look out for Jamal's best interests in a transaction anyway

give Jamal a no brokerage relationship notice before she shows him a property

observe her duty of skill, care and diligencce in the transaction

Which is NOT required for a legal brokerage firm?

Sales associates

Registration with the Division of Real Estate

Permanent, stationary construction with at least one room

Sign at the entrance with the name of the broker and the words "licensed (or Lic.) Real Estate Broker"

Clarence Lane is a Florida real estate broker associate who wants to open her own firm. She incorporates her brokerage as Blue Sky Realy, Inc. She is designing her entrance sign. Which design is accpetable?

Blue Sky Realty, Inc., Clarence Lane, Realtor

Blue Sky Realty, Inc., Clarence Lane, Florida Realtor (305) 862-5644

Blue Sky Realty, Inc., Clarence Lane, Broker

Blue Sky Realty, Inc., Clarence Lane, Lic. Real Estate Broker

Harris Realty, Inc. has designed a new website and wants to be sure it conforms to FREC requirements. The name of the company must appear

at the top of the first page

at the top of each page

below, above, or adjacent to the point of contact information

as a footer on each page

What is required when a sales associate advertises in his or her own name?

First name and last name of the sales associate

Brokerage firm name and last name of sales associate

Brokerage firm name and phone number

Brokerage firm name and address

Sales associate Charles Diamond is putting together a group of sales associates to be on his real estate team. What name should he use?

The Diamond Company

Diamond Brokers

The Diamond Group

Diamond Properties

Sales assocaite Mary prepared an offer for a house and received a $5,000 earnest money check from the buyer on Monday. Mary delivers the check to the broker on Tuesday. The check must be deposited into the broker's escrow account by the end of business on

Wednesday

Thursday

Friday 

Saturday

A broker has written a purchase and sale contract. the paries to the contract have made conflicting demands for the earnest money deposit being held in the broker's escrow account. The parties have decided that the best approach is to avoid a court fight and find an individual who will hear the facts and make a binding decision. This solution is

arbitration

mediation

an escrow disbursement order

suit for certiori

A buyer and a seller contract for the purchase and sale of a 4-bedroom home in Rockdale. The buyer gives the broker an earnest money deposit of $10,000. The contract allows the buyer to void the contract and recieve a refund of the deposit of the home inspection is not acceptable to the buyer. Because the home inspection has several minor issues, the buyer cancels the contract and demands a return of the deposit. The seller refuses because the inspection issues were minor. The broker is legally able to

refund the deposite to the buyer because the contingency was clearly stated

notify the buyer that he needs to file suit to collect the deposit

notify the Florida Real Estate Commission in writing within 15 days about the conflicting demands of the buyer and the seller

hold the deposit for escrow for up to six months until the parties agree on the dispotion of the deposit

A broker sells rental lists. A buyer bought the list, but came back to the office in ten days and requested a full refund because he didn't find a suitable rental property. The broker

need not return the funds unless the list was inaccurate

must return the entire fee

must refund 75% of the fee

may refund 50% of the fee

Which type of entity results in double taxation to shareholders?

Limited liability company

C corporation

S corporation

Limited partnership 

Which legal entity may register as a real estate brokerage?

Corporation sole

Unincorporated association

Corporation not for profit

Business trust

The best example of a trade name is

Cindy Brooks, Broker.

Melbourne Brokers, Inc.

Council Builders, LLC.

Howser Brokerage.

For a first offense that is minor and easily corrected, the DBPR will issue a

suspension

notification of noncompliance 

administrative complaint 

warning notice

Selling which type of property does NOT require a real estate license?

Business opportunity 

Leasehold

Cemetery lot

Mineral right

Henry Blake was awarded $145,000 in a judgement against a broker who violated the license law. The broker was unable to pay, so the Real Estate Recovery Fund will pay Henry

$25,000

$50,000

$75,000

$145,000

John Wilson has developed a 60-lot subdivision and has buit ten homes for sale. This type building is called

tract

custom

ranch

planned unit development

Part II of Chapter 475 applies to 

the Florida Real Estate Commission

the Florida Real Estate Appraisal Board

liens for commissions on property sale proceeds

liens for comissions on leasing property

Which is correct about the Florida Real Estate Commission?

It regulates the practice of real estate by brokers, sales associates, and appraisers

It is a police agency

Its rules provide greater detail than Chapter 475, F.S

It can fine persons who practice real estate without a license 

Which is NOT a requirement for a real estate license in Florida?

Be at least 18 years old

Be at least 21 years old

Have a U.S Social Security number

Hold a high school diploma or its equivalent

If a broker wants to close his sole proprietorship and sell property for another broker, he

may have an inactive broker associate's license.

must keep an active broker's license if he is to recieve commissions.

must be registered as a broker associate if he is to recieve commissions.

must surrender his broker's license for cancellation

Florida has agreements with certain other states that allows licensees who are residents of those states to become licensed in Florida by passing a 

40-question exam on Florida law

100-question exam on Florida law

63-hour slaes associate course

FREC-approved 14-hour continuing education course

Which individual needs a Florida real estate license?

A real estate auctioneer

A cemetary lot salesperson

A state-certified real estate appraiser when making appraisals

A cour-appointed person

A sales associate passed her state exam on June 17, 2025. Her license will expire on

June 17, 2027

June 30, 2027

March 31, 2027

September 30, 2027

A sales associate's license expired last year in April. This year in September, she wants to renew her license for the third time. She must pay a late fee, pay the renewal fee, and complete

14-hours of continuing education

28-hour of reactiviation education

a 45-hour sales associate sales post-licensing course

a 63-hour sales associate course

Broker Wilson is working with buyers to find a suitable property. He has given them a no brokerage relationship notice. He does NOT have the duty to 

present all offers

deal honestly and fairly

disclose all known facts that would materially affect the value of the property

account for all funds

If Broker Jones wants to provide limited representation to both parties in a real estate transaction, he can be a 

single agent

nonrepresentative

transactional broker

dual agent

Broker Sam is a single agent for a buyer. Which is NOT a requirement of this type of relationship?

loyal

trustworthy

caveat emptor

confidential

Wally is a single agent real estate broker who lists the Smith's house. Wally later works with a buyer who wants to purchase the Smith's house. What are Wally's options?

Become the buyer's transaction broker

Become a dual agent and represent each party equally and fairly

Continue as a designated sales associate for each party

Transition to transation broker status

What is the brokerage relationship reserved for nonresidential transactions only?

single agent

transaction broker

dual agent

designated sales associate

Broker William is a single agent for Seller Mary. William may NOT

obey Mary's legal instructions about the listing

present offers to Mary that don't have earnest money deposists

be a transation broker for a buy of Mary's property

be loyal only to Mary in the transaction 

When Broker Alice enters in to a no brokerage relationship with buyer Jamal, she must

explain her duties to Jamal

look out for Jamal's best interests in a transaction anyway

give Jamal a no brokerage relationship notice before she shows him a property

observe her duty of skill, care and diligencce in the transaction

Which is NOT required for a legal brokerage firm?

Sales associates

Registration with the Division of Real Estate

Permanent, stationary construction with at least one room

Sign at the entrance with the name of the broker and the words "licensed (or Lic.) Real Estate Broker"

Clarence Lane is a Florida real estate broker associate who wants to open her own firm. She incorporates her brokerage as Blue Sky Realy, Inc. She is designing her entrance sign. Which design is accpetable?

Blue Sky Realty, Inc., Clarence Lane, Realtor

Blue Sky Realty, Inc., Clarence Lane, Florida Realtor (305) 862-5644

Blue Sky Realty, Inc., Clarence Lane, Broker

Blue Sky Realty, Inc., Clarence Lane, Lic. Real Estate Broker

Harris Realty, Inc. has designed a new website and wants to be sure it conforms to FREC requirements. The name of the company must appear

at the top of the first page

at the top of each page

below, above, or adjacent to the point of contact information

as a footer on each page

What is required when a sales associate advertises in his or her own name?

First name and last name of the sales associate

Brokerage firm name and last name of sales associate

Brokerage firm name and phone number

Brokerage firm name and address

Sales associate Charles Diamond is putting together a group of sales associates to be on his real estate team. What name should he use?

The Diamond Company

Diamond Brokers

The Diamond Group

Diamond Properties

Sales assocaite Mary prepared an offer for a house and received a $5,000 earnest money check from the buyer on Monday. Mary delivers the check to the broker on Tuesday. The check must be deposited into the broker's escrow account by the end of business on

Wednesday

Thursday

Friday 

Saturday

A broker has written a purchase and sale contract. the paries to the contract have made conflicting demands for the earnest money deposit being held in the broker's escrow account. The parties have decided that the best approach is to avoid a court fight and find an individual who will hear the facts and make a binding decision. This solution is

arbitration

mediation

an escrow disbursement order

suit for certiori

A buyer and a seller contract for the purchase and sale of a 4-bedroom home in Rockdale. The buyer gives the broker an earnest money deposit of $10,000. The contract allows the buyer to void the contract and recieve a refund of the deposit of the home inspection is not acceptable to the buyer. Because the home inspection has several minor issues, the buyer cancels the contract and demands a return of the deposit. The seller refuses because the inspection issues were minor. The broker is legally able to

refund the deposite to the buyer because the contingency was clearly stated

notify the buyer that he needs to file suit to collect the deposit

notify the Florida Real Estate Commission in writing within 15 days about the conflicting demands of the buyer and the seller

hold the deposit for escrow for up to six months until the parties agree on the dispotion of the deposit

A broker sells rental lists. A buyer bought the list, but came back to the office in ten days and requested a full refund because he didn't find a suitable rental property. The broker

need not return the funds unless the list was inaccurate

must return the entire fee

must refund 75% of the fee

may refund 50% of the fee

Which type of entity results in double taxation to shareholders?

Limited liability company

C corporation

S corporation

Limited partnership 

Which legal entity may register as a real estate brokerage?

Corporation sole

Unincorporated association

Corporation not for profit

Business trust

The best example of a trade name is 

Cindy Brooks, Broker.

Melbourne Brokers, Inc.

Council Builders, LLC.

Howser Brokerage.

For a first offense that is minor and easily corrected, the DBPR will issue a 

suspension

notification of noncompliance 

administrative complaint 

warning notice

Selling which type of property does NOT require a real estate license?

Business opportunity 

Leasehold

Cemetery lot

Mineral right

Henry Blake was awarded $145,000 in a judgement against a broker who violated the license law. The broker was unable to pay, so the Real Estate Recovery Fund will pay Henry

$25,000

$50,000

$75,000

$145,000

The Fair house act does NOT protect persons from discrimination based on

race

sex

age

religion

The American with Disabilities Act (ADA) requires that existing structures be made accessible when

the work can be done in 15 days

it is readily achievable

The county building department can permit the work

a contractor is not needed for the work

Larry and Sally own a condominium apartment that has 1,420 square feet. The total square footage in all apartments in the building is 144,898. The annual expenses of the property are $512,000. What is their MONTHLY assessment for association fees?

$411.18

$412.69

$418.13

$5,017.60

A tenant gave a Florida broker a security deposit and moved into the rental unit. The broker

may commingle the funds if he/she posts a surety bond with the clerk of the court for the total amount of security deposits and advance rents (or $50,000, whichever is less), and pays the tenant 5% annual simple interest.

must disclose to the property owner where the funds are being held

may put the funds into an interest-bearing account if pay the tenant at least 1 percent of the average interest or a straight 2 percent per year. 

must disclose to the tenant how the money is being held and the name of the bank holding the funds within 5 days of execution of the lease

A woman has a life estate given to her by her daughter, now deceased. The Miami Opera Company is to recieve the property when she dies. Mom's will gifts the property to her son John. When Mom dies, what will be the result?

John has a reversion estate and will own the property

The daughter's estate has a reversionary interest

The Miami Opera Company has a remainder estate and will own the property

The Miami Opera Company has a reversion estate and will own the property

A tenant has vacated her rental house and is found to have a damaged several items that the landlord had to fix, costing $1,450. After 30 days the tenant demanded a return of his security deposit of $1,200. The landlord did not respond until 60 days later because the damages were higher than the deposit. Which is correct?

The landlord was correct by keeping the tenant's deposite

Because the landloard had to notify the tenant within 30 days about retaining the deposit, he has forfeited the right.

The tenant has no right to the deposit unless the tenant demands a return of the deposit within ten days

The landlord has an automatic judgement against the tenant for $250.

Three persons own real property with shares of 20%, 45%, and 35% respectively. What type tenancy do they have?

Severalty

Common 

Entireties

Joint

Sales associate Helen is showing a time-share apartment, and needs to know the type of ownership that comes with the property. Which is NOT one of the three types of time-share ownership?

Share of stock

Estate

License

Club Membership

A buyer has contracted with a seller to purchase the real property located on Sunny Street in Marianna. The buyer saw a large pile of fencing panels and posts. His sales associate said that the seller had intended to build a fense but the house sold too quickly. When the buyer moved in, the fencing was gone. The buyer filed suit stating that the intent was for the lumber to be part of the real property. The court will likely rule that

the material was real property by intent of the seller

fences are personal property, so the material was personal property

the fence material was personal property because it was not attached

the material stack was large enough to be a shed, so it should stay on the property

Which is real property?

Area rug

Floor lamp

Refrigerator

Ceiling fan 

The state of Florida sued a property owner under its eminent domain powers and obtained owernship. This transfer of ownership right is called

alientation

certiori

constructive notice

singularity

Which is NOT one of the four main documents required to form a condominium?

Declaration

Bylaws

Conveyance

Proprietary lease

Larry has contracted to buy a house on Main Street, but the transaction has not actually closed. Larry has

equitable title

legal title

conditional title 

contingent title

Which is NOT an example of involuntary alientation?

Descent

Eminent domain

Deed

Escheat

The state of Florida wants to use its power of eminent domain to obtain title to a property for a highway. If the owner objects to the amount of the payment, the state will file suit for

alienation

condemnation

judgement

adverse possession

In a legal description, bounds refers to

north

distance

direction

primary reference

When the buyers of a home visit to inspect the property, they encounter a tenant who says he has four months remaining on his lease. The seller had not disclosed this fact. How did the buyers recieve notice about the occupancy?

Actual

Fraudulent

Constructive

Lis Pendens

McManus buys a property, but does not move in. The deed is recorded. The seller is dishonest and sells the property to Lawrence. Lawrence records the deed and moves into the property. A court case is brought to decide the issues. Who will own the property, and why?

McManus, because of contructive notice.

McManus, because of actual notice

Lawrence, because of actual notice

Lawrence, because of contructive notice

A property rents for $40 per square foot. The index used for the lease is 400. The following year, the index has risen to 450. What will be the rent in year two?

$42 per square foot

$43 per square foot

$44 per square foot

$45 per square foot

A contract for the sale of real estate is not valid if

not signed by two witnesses

one of the parties is a felon

the buyer has not included an earnest money deposit

a surveyor cannot locate the boundaries of the property from the legal descriptions in the contract

Which is a correct "call" for a metes and bounds property description?

N 160 E for 65 feet

E 87 N for 65 feet

N 95 S for 65 feet

N 42 W for 65 feet

Which legal description method uses meridians and base lines?

Lot and block

Government survey

Monuments

Metes and bounds

How many acres are in a legal description showing "...S 1/2 of the NW 1/4 of the NE 1/4 of Section 10, township 4 South, Range 24 West?"

10

20

40

80

Which document can a broker NOT prepare for a customer?

A lease on a Supreme Court-approved form

A buyer-brokerage agreement 

A deed

A listing agreement

Which is NOT an essential element of all contracts?

Written

Legally competent parties

Consideration

Agreement

John sold his house to Albert on a handshake, but did not put the agreement in writing. Alber gave John a check $3,000 as good faith and agreement to close in 30 days and pay the remainder of the price. If John changes his mind about selling, what action would cause a court to rule that the agreement was legally binding?

John gave the earnest money back to Albert 

There was a witness to the handshake agreement

Albert moved into the house

Alber mailed a change of address form to the postal service

William saw his friend John at the theatre. Knowing that John was a broker, William said "John, my house is for sale. Why don't you sell it?" Sure enough, John brought a contract to William at the asking price. John showed up at the closing, and requested a commission. William told John he never had a listing agreement. If it goes to court, John's attorney will argue that the parties

had a bilateral agreement

had an expressed agreement

had an informal agreement 

had an implied agreement

A buyer breached the contract. The seller does NOT have a right to

compensatory damages

specific performance

withdrawl 

liquidated damages

Cindy signed an offer for a house and gave a good-faith deposit to Broke Carole. The offer was to expire at 6 pm three days ahead. That same day, Carole was presenting the contract to Seller Bob when Cindy called and told Carole she had changed her mind and requested a refund of the deposit. What should Carole do?

Tell the seller to quickly sign the contract so she wouldn't have to return the deposit

Tell Cindy she had to wait until 6 pm three days ffrom now to request a refund

Refund the deposit

Notify the FREC in writing within 15 days. then do one of the settlement procedures within 30 days

Lance has agreed to buy a house from Henry. Lance's friend Susan asks whether he could take his place on the contract and buy the house instead. Lance wants to be relieved of liability and asks Henry to sign a new contact with Susan. Henry agrees and Lance's name is replaced with Susan's as buyer. This is

an anticipatory breach 

a novation

a counteroffer

a rescission

A buyer makes an offer to purchase a house, and the broker goes to present the offer to the seller. Which is NOT an option for the seller?

Accept the offer

Withdraw the offer

Reject the offer

Counteroffer

Wilson has signed a contact to sell his house to Deeb, with the closing date set to March 31. Floodwaters associated with a hurricane destroy the property. The contract is terminated by

recission

impossibility of performance

operation of law

breach by the seller

Sarah contracted to buy Glenda's house. When the day of closing arrived, Glenda said she wanted to keep thje house and not sell. If Sarah wants the house, she should sue for 

liquidated damages

specific performance

compensatory damages

the court to rescind the contract

A seller of a commercial property agrees to gibe a broker an opening listing. The seller says, "I want $250,000 net to me. You can put your commissionm on top of that. If the broker usually asks for a 6% commision on the sale price of commerical property, at what price shold the broker list the property to recieve the right commission?

$265,957.45

$265,000.00

$266,118.30

$267,819.54

Which is correct about purchase and sale contracts for real estate?

Seller is the vendor

If not stated in the contract, seller must give a quit-claim deed

Can be written or oral

Lead-based paint disclosure required on every residential sale contract

Some states, including Florida, have mortage laws that consider the borrower, who is the property owner and the lender, who has a recorded lien. This legal concept is called the 

mortage theory

lien theory

title theory

collateral theory

The collateral for a real estate debt is a 

promissory note

mortage

trust deed

hypothecation

Assume a borrower finances the purchase of a home with a $250,00 mortage at 3.5 percent interest for 30 years. The monthly principal and interest on the loan is $1,122.61. The annual taxes are estimated at $2,820 and the hazard insurance is $1,450. What will the total payment be if the lender requires an escrow?

$1,322.89

$1,478.43

$1,489.30

$1,494.29

A clause in most mortgages allows lenders to require immediate payment of the loan if they property is sold without the lender's concent. The name of this clause is

receivership

defeasance

due on sale

reinstatement 

The stated interest rate on a new loan is 4 percent but the investor who is buying the loan requires a yield of 4 3/8 percent. How many points must the borrower pay to obtain this loan?

1

2

3

4

Judy purchased a home for $200,00 and financed 90% of the purchase price. She agreed to pay two discount points to obtain the loan. What was the dollar amount of points?

$1,800

$2,000

$3,600

$4,000

If a secondary market lender is buyin an existing loan form the original lender, the secondary market lender may request that the borrower verify the balance of the loan and the interest rate. This verification is called

a statement of certiori

a vendor's letter

an estoppel certificate

a novation

In a contract for deed, the buyer recieves

legal title

a deed and a mortgage

equitable title

a cognovit deed

A buyer is purchasing a property that has an existing mortgage. In which case will both the buyer and seller be liable on the mortgage?

If the buyer takes the property subject to the morgage

If the buyer assumes the mortgage

If the parties get together with the lender and sign new papers (a novation)

If the seller requires the borrower to qualify for the loan and is released from the obligation

Larry has contracted to purchase real property from Barney. The title closing agent calls Larry to tell him about a lis pendens against the property. This news says that 

a lien has been filed for back taxes

the property is the subject of a lawsuit

the property has been sold at a tax deed auction

the seller can't close because the liens against the property exceeded the purchase price

A property sells to a well-qualified borrower who wants a low-down-payment FHA loan. If the purchase price is &270,000, the down payment will be

$0

$9,450

$13,250

$14,500

A family has gross monthly income of $7,250. Their payment of principal interest, taxes, insurance, and homeowner's association payments are $2,035. What is their housing expense ratio?

29%

28%

27%

26%

The FHA loan used for condominiums is Section

203(b)

204(k)

234(c)

251

When a lender evaluates a borrower's willingness to pay, the lender would review the borrower's 

income

credit score

assets

types of credit

A broker sold his listing for $250,000 and gets a commission of $17,500. What was the commission rate?

5%

6%

7%

7.5%

A buyer should pay for the first year's policy at least 30 days in advance if the transaction is

for the purchase of an investment property

expected to close during hurricane season

to be financed with an FHA or VA mortgage

going to be for an owner occupied ouse

Joseph sold a property for $400,000. He had purchased it four years earlier for $320,000. What was Joseph's percent of profit?

20%

22.5%

25%

28%

Which is a requirement for appraisals used in a federally-related transaction?

Prepared by a broker or a certified appraiser

Appraiser fee limited to 1/2 % of the loan amount

Conform to FHA appraisal standards

Written

Property taxes are $2,932. Closing date is April 14. Prorations will be made as aof midnight the day before closing using the 365-day method. What will the closing statement entry be for the property tax proration?

$827.39 debit buyer, credit seller 

$2,104.61 debit seller, credit buyer

$2,104.61 debit buyer, credit seller

$827.39 debit seller, credit buyer

An investor is buying a rental house that is occupied by a tenant who will stay in the property. The tenant paid $2,800 rent on the first of the month. The closing date is October 10. Prorations will be made as of midnight the day before closing using the 365-day method. What will the closing statement entry be for prepaid rent?

$1,987.10 debit seller, credit buyer

$1,896.77 debit seller, credit buyer

$812.90 debit buyer, credit seller

$903.22 debit buyer, credit seller

A buyer bought a property for $350,000 and financed the purchase with a new mortgage in the amount of $280,000. What are the total documentary stamps and intangible taxes on this transaction?

$3,430.00

$3,990.00

$2,450.00

$1,540.00

Which is NOT one of the four essential requirements for real property to have value?

Demand

Supply

Transferability

Utility

In order to be considered the highest and best use of a property, the use must be

the most profitable use

the use that returns the most to the building

physically possible

the safest use

The sales comparision approach is based on the theory of

substitution

conformity

increasing returns

highest and best use

The subject house has 1,940 square feet of living area; the comparable sale has 2,100 square feet, and sold for $412,500. An appraiser has estimated the difference should have an adjustment of $161 per square foot. The value of the subject property based on the comparable sale approach would be approximately.

$381,400

$386,700

$394,200

$438,300

One method for determining the cost ro reproduce a building new is to make a detailed inventory of every item in the building, price them out, and add the builder's cost and profit. This method is called the

unit in place method

quanitity survey method

comparative square foot method

index method

A property has 65 units. Each of them rent for $18,000 annually. The vacancy rate is 6%. Operating expenses are 42% of effective gross income. What is the net operating income of this property?

$637,884

$608,400

$607,500

$535,000

A large, older office building downtown needs painting and general maintenance. The floor plan has too many hallways, making it inefficient. It is in an area thaat has become mostly industrial with heavy truck traffic and noise. An appraiser has estimated the reporoduction costs and is working on calculating deprecation. What type depreciation is the building's age, painting and general maintenance?

Physical deterioration

Functional obsolescence

External obsolescence

Progressive obsolescence

What type risk can be reduced by buying insurance?

Dynamic

Static

Business

Financial

A business enterprise that is for sale is very profitable. An appraiser would most likely value the business using which approach?

Cost

Income

Market

Liquidation

A homestead is assessed at $112,000. What is the homestead exemption for school board taxes?

$50,000

$30,000

$25,000

$15,000

The taxable value of a qualified homestead property is $49,000. The owner is blind. The city tax rate is 9.5 mills, the county tax rate is 8.5 mills, and the school board tax rate is 10 mills. What are the property taxes on this home?

$532

$558

$572

$596

A city plans to pave a dirt road fronted by 24 houses (twelve on each side). The cost of the paving is $36 per running foot. There are 1,400 running feet on the road. Sam has a house that has 85 feet frontage on the road. What will he have to pay if the city is not paying any of the cost?

$1,345

$1,530

$2,245

$3,060

Residential zoning regulates

intensity of use

density

style of houses

square footage