California “R.E. Practice” questions Ch16-Ch18
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California: Real Estate Practice – Chapter 16 Quiz with no answers
Answers will be revealed with proper subscription
1 of 10 According to FIRPTA, what percent would a buyer who is buying the property as a personal residence need to withhold when purchasing a $200,000 home from a foreigner?
A. 0%
B. 15%
C. 3.30%
D. 10%
2 of 10 How long must buyers and brokers keep the documentation on a foreign sale?
A. 2 years
B. 3 years
C. 4 years
D. 5 years
3 of 10 Homeowners can deduct all but which of the following from their income taxes?
A. Mortgage interest
B. Depreciation
C. Prepayment penalties
D. Property taxes
4 of 10 A totally disabled veteran could be eligible for a property tax exemption of up to what amount?
A. $50,450
B. $100,730
C. $191,266
D. $206,850
5 of 10 Mike bought his home last year for $150,000. His property taxes would be assessed at:
A. $1,000
B. $1,500
C. $2,250
D. $3,000
6 of 10 When a person acquires new property, which is true?
A. The owner has 30 days to notify the county assessor.
B. The seller must file a bill of sale with the county clerk.
C. The owner has 45 days to pay the new property taxes.
D. The owner has 45 days to file a change in ownership statement.
7 of 10 Bill and Brenda bought their home for $150,000 seven years ago and have lived in it ever since. They made $50,000 of improvements. They sold the home for $450,000 and paid $30,000 in selling expenses, including the broker’s commission. On what amount will they pay capital gains tax?
A. $0
B. $100,000
C. $250,000
D. $300,000
8 of 10 When is the first installment of property taxes due?
A. First of February
B. Tenth of April
C. First of November
D. Tenth of December
9 of 10 How can a seller lessen the tax impact of selling a home for enough profit that he or she will be boosted to a much higher tax bracket?
A. There is nothing that can offset this problem.
B. Do a tax-free exchange instead.
C. Participate in a tax shelter program.
D. Do an installment sale.
10 of 10 Which proposition limited the maximum amount of tax on real property?
A. Proposition 13
B. Proposition 58
C. Proposition 60
D. Proposition 90
Bonus ch16 questions –
1- When is real property reassessed?
2- What does Proposition 58 state?
3- For whom do property tax exemptions exist and for how much?
4- Explain the documentary transfer tax.
5- Under what circumstances can a loss on the sale of a personal residence be deducted from income taxes?
6- What items can an owner of an income-producing property deduct that an owner of a personal residence cannot?
7- What are the capital gains exclusions associated with the sale of a personal residence?
8- What is important for a broker to remember about the Foreign Investment in Real Property Tax Act?
California: Real Estate Practice – Chapter 17 Quiz with no answers
Answers will be revealed with proper subscription
1 of 10 Which figure represents the amount of income available as a return to an investor?
A. Net operating income
B. Potential gross income
C. Adjusted gross spendable income
D. Effective gross income
2 of 10 Which lender typically deals in interim financing?
A. Commercial bank
B. Life insurance company
C. Syndicate
D. Real estate trust
3 of 10 Which of these lenders would be most likely to finance a large shopping mall?
A. Commercial bank
B. Seller
C. Savings and loan association
D. Life insurance company
4 of 10 Examining the economic soundness of a property means looking at all of the following except which?
A. Zoning issues
B. Community growth trends
C. Refinancing
D. Income projections of the property
5 of 10 When all members have unlimited liability for debts and obligations of the group, the organization is a:
A. Limited Partnership
B. Corporation
C. General Partnership
D. Syndicate
6 of 10 What is the foremost reason people invest in property?
A. To save on taxes
B. To make money
C. To plan for retirement
D. To have a second home to enjoy
7 of 10 Which of the following is a possible benefit of investing in real property?
A. Capital outlay
B. Financing
C. Appreciation
D. Property management
8 of 10 An association of two or more people who combine financial resources to achieve investment objectives is:
A. Not allowed in California.
B. A syndicate.
C. Made up of wealthy individuals.
D. A group of brokers.
9 of 10 Which statement is not true about a Real Estate Investment Trust?
A. Sells ownership shares.
B. Receives special tax considerations.
C. Offers high yields to customers.
D. Easy to qualify for.
10 of 10 Which of the following is not a possible benefit of investing in real property?
A. Tax shelter
B. Liquidity
C. Income
D. Stability
Bonus ch17 questions –
1- What are the three important considerations for a good property investment?
2- What are some tax benefits associated with investing?
3- How could refinancing be an investment benefit?
4- How is property management seen as a risk to investing?
5- How do life insurance companies get involved in the investment market?
6- How does a limited partnership differ from a general partnership?
7- What does the net operating income of a property represent?
8- When studying the characteristics of an area in which an investment property is located, what factors should the investor look at carefully?
California: Real Estate Practice – Chapter 18 Quiz with no answers
Answers will be revealed with proper subscription
1 of 10 What kind of lease contains a recapture clause?
A. Percentage
B. Net
C. Gross
D. Graduated
2 of 10 When can a landlord enter a tenant’s property to make repairs or show it?
A. Only after receiving the tenant’s consent.
B. During business hours and only after giving the tenant 24 hours notice.
C. Anytime he or she chooses.
D. Only with a court order.
3 of 10 The IREM designation reserved for individuals who meet a certain level of education and experience is:
A. CPM
B. ARM
C. CPR
D. AMO
4 of 10 When setting up a rent schedule, a property manager should analyze all but which of the following?
A. Neighborhood amenities
B. Community growth
C. Area vacancy rates
D. New home sales
5 of 10 California allows a property manager to charge a non-refundable fee for which?
A. cleaning
B. security
C. background check
D. breakage by children
6 of 10 How often can a tenant call his or her own professional to make repairs and then deduct the amount from the next month’s rent?
A. Never
B. Once every 3 months
C. Once a year
D. Twice in a 12-month period
7 of 10 Which document shows the assets and liabilities of a business?
A. Bill of sale
B. Balance sheet
C. Profit and loss statement
D. Purchase contract
8 of 10 A lease that has no time limit is an:
A. Estate for years
B. Estate at will
C. Estate from period to period
D. Estate at sufferance
9 of 10 Which of the following represents an intangible business asset?
A. Equipment
B. Inventory
C. Goodwill
D. Fixtures
10 of 10 When a tenant agrees to pay all taxes, insurance, maintenance and repairs, that tenant has what kind of lease?
A. Gross
B. Percentage
C. Net
D. Graduated
Bonus ch18 questions
1- What is goodwill as it relates to a business?
2- List the three Institute of Real Estate Management property management designations.
3- What are the three general responsibilities of a property manager?
4- Describe how a property manager can receive his or her fees.
5- What should a good management contract contain?
6- Which type of leasehold estate is commonly referred to as a periodic tenancy?
7- Define a gross lease.
8- Under what conditions may a landlord enter a tenant’s property?
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