California Principles questions Ch25-Ch27

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Principles Ch25 quiz

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1 of 10 How many, if any, escrow or trust accounts must a property manager maintain?

A.    Three – One is for security deposits; one for current rents and management; and one for maintenance funds.

B.     Two – One is for security deposits and one for current rents and management.

C.     One for security deposits.

D.    None of the above

Principles

2 of 10 The duties of a property manager to an owner include which of the following?

A.    Obtaining maximum profit on the property.

B.     Evaluating the Rental Market

C.     Handling Tenant Complaints and Conflicts

D.    All of the above

3 of 10 Rafe is an assistant property manager of a large residential community. He wants someday to be promoted to property manager. Rafe needs to consistently learn his duties and responsibilities to the owner and demonstrate them accordingly. What duties/responsibilities should he focus on?

A.    Fiduciary Responsibility to the Owner

B.     Achieving the Highest Rate of Return for the Owner

C.     Disclosure of Material Facts

D.    Both A and B

4 of 10 Sam is the owner of a ten-unit apartment complex. He has just hired a new property manager to run the property. Serena, the new property manager, has been drawing up a new set of management plans for the property. What should be the deciding factors in the adoption of the new plans?

A.    The Owner’s Objectives

B.     The Fair Housing Laws

C.     The Management Agreement

D.    Both A and B

5 of 10 Peter has been offered the position of property manager for a large apartment complex. These apartments are upscale with impeccable maintenance programs and beautiful amenities for its residents. His contract has a clause that states, “If at any time during our agreement the property has a vacancy rate of more than 12%, our agreement is cancelled.” Should this clause give Peter pause in accepting the position? Does this type of clause have a name?

A.    Yes, Peter should be giving this position a second thought based on the clause. This type of clause is an Allowable Vacancy Rate.

B.     No, Peter shouldn’t worry about the clause. He needs to have faith in his abilities. The property is upscale and very desirable and shouldn’t have a vacancy issue. This type of clause is an Allowable Vacancy Rate

C.     No, Peter shouldn’t worry about the clause. There are ways to work around such a statement. If necessary, he can rent to anyone, regardless of their qualifications, to fulfill the required vacancy rate. This type of clause is a Maximum Profit Clause.

D.    Yes, Peter should be giving this position a second thought based on the clause. This type of clause is a Rate of Return for Owner Clause.

6 of 10 Amy suffered a spinal cord injury. She is partially paralyzed and confined to a wheel chair. She is self-sufficient in day-to-day living, has a career, and is looking for a new apartment. She decides to take a tour of Golden Gate Gables apartments. She was very happy with the two-bedroom unit and wants to put in an application for the unit. She has a special van—to accommodate her wheelchair–that requires an extra-wide disabled parking space. The Golden Gate Gables does not provide any special parking for the disabled. If Amy’s application is approved for the apartment, does the apartment complex have to install a special parking spot for Amy?

A.    Yes, according to the ADA, the first priority is the “get to the door standard” that includes installing ramps, widening entrances, and providing accessible parking spaces.

B.     No, as long as Amy has received full disclosure of the absence of any special parking for her needs, if she decides to pursue the application further, that is her decision.

C.     No, Amy cannot expect special accommodations for herself because she decides she would like to live in the complex. It would take time and money to make the necessary changes. The complex is not obligated to make those changes for her.

D.    Both B and C

7 of 10 XYZ Development, Inc. leases commercial space to businesses. Most of the leases are long-term, from five to fifteen years in length and have fixed rents. XYZ’s contracts contain a clause in which both parties agree to annual adjustments of rent based on tax increases and other operating costs. If the previous year did not see more than a five percent increase in these costs, there is no change in the rent. What is the clause?

A.    Allowable Vacancy Rate Clause

B.     Escalator Clause

C.     Operating Costs Adjustment Clause

D.    Periodic Tenancy Clause

8 of 10 Pelican Bay Apartments is a complex consisting of 80 units. The units are available in studio and one-, two-, and three-bedroom apartments. Kimberly Bracco is the property manager of Pelican Bay. She has decided to stay in her condo and not reside at Pelican Bay. She is also pursuing her California real estate license as she manages the property. Is anything wrong with this scenario?

A.    No, Kimberly does not have to reside on the property she manages. Pursuing her real estate license is additionally optional.

B.     Yes, in California any apartment complex that has sixteen or more rental units must have a manager that lives on-site. In addition, Kimberly, as an off-site manager, must hold a real estate broker license. If she decides to hire a residential manager, who lives on the property, they do not need a broker’s license.

C.     Yes, Kimberly is required to live on-site if the complex has more than ten rental units.

D.    None of the above.

9 of 10 Penny and Joe rent an apartment in the Trade Winds apartment complex. They moved in one month earlier and signed a one year lease. Today the couple received a notice stating the complex has been sold and their lease will terminate at the end of thirty days. Is this a violation?

A.    No, if the complex has been sold, the new owners may do with the apartments as they wish. A thirty day notice to vacate is more than sufficient.

B.     Yes, it is a violation. Penny and Joe must have sixty days from the sales transaction to vacate their apartment and terminate the lease.

C.     Yes, it is a violation. Leases do not terminate because a property is sold.

D.    None of the above

10 of 10 Which of the following is not a part of a property management agreement?

A.    Property Description and Term of Agreement

B.     Definition of Responsibilities and Extent of Authority

C.     Americans with Disabilities Act (ADA)

D.    Management Fee and Allocation of Costs

Principles Ch26 quiz

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1 of 10 Public notice must be given of a bulk transfer of inventory in a business sale. What is this notice known as and where must the notice be published?

A.    The public notice is known as Notice of Intent to Transfer Inventory and must be published in a general circulation newspaper.

B.     The public notice is known as Notice of Intent to Sell and must be published in a trade newspaper.

C.     The public notice is known as Notice of Intent to Sell Bulk and must be published in a general circulation newspaper.

D.    The public notice is known as Notice of Intent to Sell Bulk and must be published in a trade newspaper.

2 of 10 Martin is purchasing a personnel agency from Warren and his partner. The agency has been very successful over its twenty years in business, and Warren is ready to retire. What elements should Martin expect from Warren as part of the business sale?

A.    A bill of sale and specific financial statements.

B.     A bill of sale and a bulk transfer of any inventory.

C.     A bill of sale; a balance sheet; the profit and loss statement; and a bulk transfer of any inventory.

D.    None of the above

3 of 10 How is goodwill protected in business opportunity transactions?

A.    Goodwill is not tangible property and, therefore, cannot be protected.

B.     The goodwill of a business has monetary value, which is protected by law.

C.     Goodwill is the expectation of continued public patronage.

D.    Goodwill is protected by Sherman Anti-trust laws.

4 of 10 Johanna is selling her restaurant, J’s Café. She has decided restaurant hours are too long for her and is changing careers. Matt, a licensee, is assisting Johanna in the sale of the café. She wants to sell both the real property, the restaurant itself, and all of the personal property inside to one buyer. A buyer is interested in the physical restaurant, the business itself, and all of the personal property inside the restaurant. How will Matt handle the sale of both the real property and the business itself?

A.    Matt, as a licensee, is not authorized to conduct the sale of a business. He may assist Johanna in the real property transaction, but not the personal property that represents the business.

B.     Matt must treat the sale of the business and the sale of the real property as two separate and concurrent transactions with two concurrent and contingent escrows.

C.     Matt may sell the entire business opportunity in one sales transaction. Due to its encompassing the real property, the business, and the personal property of the restaurant, it is a single sale.

D.    None of the above

5 of 10 Tucker, a licensee, has been instrumental in the sale of a nightclub to a group of investors. He has guided the buyers every step of the way in obtaining this new business opportunity. What government agencies are also in need of notification by the investors concerning their new business?

A.    IRS

B.     State Board of Equalization

C.     California BRE

D.    Both A and B

6 of 10 The Hannekes are selling their pharmacy to a small investor. They have decided not to follow the regulations set forth by the bulk sale law. Is the sale considered valid between the two parties?

A.    The sale is considered valid between the two parties; it is void against creditors; they are legally permitted to attach inventory for any debt.

B.     The sale is considered invalid between the two parties due to not following the regulations set forth by the bulk sale law.

C.     The sale is considered valid between the two parties and all creditors. The bulk sale law is set up to ease the transfer of inventory in a business sale.

D.    None of the above

7 of 10 Maria and Carlos are selling their grocery store to a large corporation. There will be a bulk transfer of the store’s inventory in the sale to the corporation. Public notice must be given of this transfer. Who must give the public notice? How many days public notice must they give and why?

A.    The sellers must give the public notice. They must give a public notice 12 business days before the transfer occurs. It gives the buyers’ creditors an opportunity to file a claim if trade credit is still owed on the inventory.

B.     The buyers must give the public notice. They must give a public notice 12 business days before the transfer occurs. It gives the seller’s creditors an opportunity to file a claim if trade credit is still owed on the inventory.

C.     The buyers must give the public notice. They must give a public notice 15 days before the transfer occurs. It gives the seller’s creditors an opportunity to file a claim if trade credit is still owed on the inventory.

D.    The buyers must give the public notice. They must give a public notice 10 business days before the transfer occurs. It gives the seller’s creditors an opportunity to file a claim if trade credit is still owed on the inventory.

8 of 10 Which of the following statements is false in reference to a balance sheet?

A.    The balance sheet shows the business’s profits for the last 3 years.

B.     The balance sheet shows the assets of a business as of a particular date.

C.     The balance sheet shows the net worth of a business as of a particular date.

D.    The balance sheet shows the business’s liabilities as of a certain date.

9 of 10 Damon has a string of misdemeanor convictions. He was just cleared of felony fraud. Damon is now opening a restaurant and wants to serve alcohol. What are Damon’s chances of being issued a liquor license?

A.    Not very good at all. According to the Alcoholic Beverage Control Act, the person must be of good moral character. All of Damon’s convictions probably won’t bode well with his receiving a license.

B.     The same as others. Damon only has misdemeanor convictions. He was acquitted of the felony charge.

C.     Damon may be issued a probationary liquor license due to his previous convictions.

D.    None of the above

10 of 10 What does the term “turnover” reference in a business opportunity?

A.    The amount of employees being employed and leaving employment of a business.

B.     The number of times the inventory is sold per year.

C.     The number of times a business has been sold.

D.    None of the above

Principles Ch27 quiz

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1 of 10 Civil Code Section 1365.1 states that the homeowner association must distribute a written notice entitled, “NOTICE ASSESSMENTS AND FORECLOSURE” to EACH member of the common interest development association. How long immediately preceding the beginning of the association’s fiscal year must this notice be distributed?

A.    60 days

B.     90 days

C.     3 months

D.    4 months

2 of 10 Certain disclosures must be made within the Subdivided Lands Public Report Notice of Intention. Recently, an amendment to these disclosures has added which of the following to the required disclosures under this notice?

A.    Supplemental Property Tax Notice

B.     Automatic Stay Disclosures

C.     Brownfield Disclosures

D.    All of the above

3 of 10 Under California Finance Code, what is defined as a consumer credit transaction that is secured by real property located in California, which is used, or intended to be used or occupied, as the principal dwelling of the consumer?

A.    Vacant land loan

B.     Consumer loan

C.     Commercial loan

D.    Land development loan

4 of 10 Assembly Bill 1099 does not require a property tax reassessment for the construction or addition of

A.    a beachfront home.

B.     a separate building such as a guest home or workshop measuring less than 1,500 square feet.

C.     an active “solar energy system” in a new subdivision.

D.    a barn or horse corral built on a parcel of land two acres or larger.

5 of 10 Each of the following types of housing, with one exception, falls under the heading of Common Interest Development. Which is the exception to this?

A.    A manufactured housing community.

B.     A condominium project.

C.     A community apartment project.

D.    A stock cooperative.

6 of 10 Under the amended Davis-Stirling Common Interest Development Act, in order to grant the exclusive use of a common area to one or more owner, there must be a passing affirmative vote of what percentage of the owners of that common interest development?

A.    51%

B.     67%

C.     69%

D.    75%

7 of 10 San Diego tenant Jack Stone is a full-time slacker. The guy has not paid rent in months and refuses to give up possession of the property. After many attempts to solve the problem outside of a courtroom, landlord Tom Crick gives up, files an eviction notice, and obtains a judgment to obtain possession of the property. Three weeks later, however, Jack tells Tom that just that morning he’s filed for bankruptcy–so the eviction is off. Which of the following statements is true of this situation?

A.    Tom is out of luck and should get in line behind Jack’s other creditors. As for the apartment, Jack cannot be forced out of it when he’s in bankruptcy.

B.     Tom is in luck. Since he has already taken the appropriate actions and obtained a judgment to obtain possession of the property before Jack filed his bankruptcy petition, the previously filed eviction remains in effect.

C.     Tom and Jack must retain lawyers to sort out this mess, because there is no set way of handling this type of situation.

D.    Because Jack was able to successfully file a bankruptcy petition, he may not have to move out yet. He must attempt to file a Retroactive Petition for Bankruptcy, with the required documentation from that time period. If he obtains a judgment stating that.

8 of 10 In some counties, certain funds are collected and then distributed to be used only for the exclusive purpose of deterring, investigating, and prosecuting real estate fraud crimes. This fund is the:

A.    Real Estate Advisory Commission Fund.

B.     Real Estate Recovery Account.

C.     Real Estate Fraud Prosecution Trust Fund.

D.    Real Estate Fraud Investigation Fund.

9 of 10 If a person believes that her property has been placed under an unlawful restriction, covenant, or other provision, based on an arbitrary reason as defined in the Government Code, she may:

A.    Refuse to pay her rent or mortgage.

B.     File suit against the parties that sold her or rented her the property.

C.     File a civil suit against the party/parties that so placed this unlawful restriction.

D.    Record a Restrictive Covenant Modification document.

10 of 10 Formerly, the Unruh Civil Rights Act protected people from being discriminated against because of their sex, race, color, religion, ancestry, national origin, disability, or medical condition. However, recent changes have added two new bases for discrimination that are illegal in California. These are:

A.    Marital status and legal source of income.

B.     Marital status and source of income.

C.     Marital status and sexual orientation.

D.    Legal source of income and sexual orientation.

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