M-100 Community Association Management Exam
Prep | 300+ Practice QUESTIONs with Correct
Answers & Detailed Explanations
QUESTION 1
What do Articles of Incorporation primarily establish for a community
association?
• A. The daily landscaping and maintenance schedule
• B. The legal corporate entity under state law, including its name,
purpose, and initial board structure
• C. The architectural color palette for fences and exterior paint
• D. The employee holiday party budget and vendor bonuses
Correct Answer: B. The legal corporate entity under state law, including
its name, purpose, and initial board structure
Detailed Rationale: Articles of Incorporation create the non-profit
corporation with the state secretary of state, defining its core legal
existence and corporate structure.
QUESTION 2
Under the hierarchy of governing documents, what happens if an
association's Bylaws conflict with the recorded Declaration (CC&Rs)?
• A. The Bylaws automatically override the Declaration.
• B. The Declaration takes precedence, and the conflicting Bylaw
provision is legally invalid.
, • C. Both documents are discarded, and state law takes over
completely.
• D. The board can choose which document to follow by a coin flip.
Correct Answer: B. The Declaration takes precedence, and the
conflicting Bylaw provision is legally invalid.
Detailed Rationale: Higher-level governing documents
(Declaration/CC&Rs) supersede lower-level documents (Bylaws, Rules),
and lower-level provisions cannot violate higher ones.
QUESTION 3
What does a "Fully Funded Balance" represent in a reserve study?
• A. The total amount of money collected from homeowners on day
one of purchase
• B. The theoretical baseline dollar amount that should be in the
reserve fund based on the fraction of useful life elapsed for each
component
• C. The maximum bank credit limit allowed for the association
corporation
• D. The exact cost of a community swimming pool remodel
projected for the year 2050
Correct Answer: B. The theoretical baseline dollar amount that should
be in the reserve fund based on the fraction of useful life elapsed for
each component
,Detailed Rationale: Fully funded balance is calculated by multiplying the
current replacement cost by the fraction of useful life consumed up to
date.
QUESTION 4
What is a "Limited Common Element" in a condominium property?
• A. A common element reserved for the exclusive use of one or
more, but less than all, unit owners (e.g., assigned balconies or
parking stalls)
• B. A private room owned exclusively by the developer forever
• C. A public municipal street maintained by the city government
• D. An area where no residents or guests are ever allowed to walk
Correct Answer: A. A common element reserved for the exclusive use of
one or more, but less than all, unit owners (e.g., assigned balconies or
parking stalls)
Detailed Rationale: Limited common elements are owned commonly by
all owners but designated for the exclusive physical use of specific
individual owners.
QUESTION 5
Which federal law prohibits discrimination in housing based on race,
color, religion, sex, familial status, national origin, or disability?
• A. The Fair Housing Act (FHA)
• B. The Occupational Safety and Health Act (OSHA)
• C. The National Labor Relations Act
, • D. The Fair Credit Reporting Act
Correct Answer: A. The Fair Housing Act (FHA)
Detailed Rationale: The FHA applies broadly to housing providers,
including community associations, prohibiting discrimination across
protected classes in sales, rentals, and services.
QUESTION 6
When an owner requests a reasonable accommodation under the Fair
Housing Act for an assistance animal in a strict "no pets" community,
what must the association do?
• A. Deny the request immediately and fine the owner $1,000.
• B. Review the request and grant a waiver if the individual has a
verifiable disability and a disability-related need for the animal.
• C. Require the owner to pay a $10,000 security deposit for the
animal.
• D. Evict the owner from the property within 24 hours.
Correct Answer: B. Review the request and grant a waiver if the
individual has a verifiable disability and a disability-related need for the
animal.
Detailed Rationale: Reasonable accommodations must be granted
under federal law when disability criteria are met, overriding standard
community pet restrictions.
QUESTION 7
What is the main purpose of an Association's Annual Budget?
Prep | 300+ Practice QUESTIONs with Correct
Answers & Detailed Explanations
QUESTION 1
What do Articles of Incorporation primarily establish for a community
association?
• A. The daily landscaping and maintenance schedule
• B. The legal corporate entity under state law, including its name,
purpose, and initial board structure
• C. The architectural color palette for fences and exterior paint
• D. The employee holiday party budget and vendor bonuses
Correct Answer: B. The legal corporate entity under state law, including
its name, purpose, and initial board structure
Detailed Rationale: Articles of Incorporation create the non-profit
corporation with the state secretary of state, defining its core legal
existence and corporate structure.
QUESTION 2
Under the hierarchy of governing documents, what happens if an
association's Bylaws conflict with the recorded Declaration (CC&Rs)?
• A. The Bylaws automatically override the Declaration.
• B. The Declaration takes precedence, and the conflicting Bylaw
provision is legally invalid.
, • C. Both documents are discarded, and state law takes over
completely.
• D. The board can choose which document to follow by a coin flip.
Correct Answer: B. The Declaration takes precedence, and the
conflicting Bylaw provision is legally invalid.
Detailed Rationale: Higher-level governing documents
(Declaration/CC&Rs) supersede lower-level documents (Bylaws, Rules),
and lower-level provisions cannot violate higher ones.
QUESTION 3
What does a "Fully Funded Balance" represent in a reserve study?
• A. The total amount of money collected from homeowners on day
one of purchase
• B. The theoretical baseline dollar amount that should be in the
reserve fund based on the fraction of useful life elapsed for each
component
• C. The maximum bank credit limit allowed for the association
corporation
• D. The exact cost of a community swimming pool remodel
projected for the year 2050
Correct Answer: B. The theoretical baseline dollar amount that should
be in the reserve fund based on the fraction of useful life elapsed for
each component
,Detailed Rationale: Fully funded balance is calculated by multiplying the
current replacement cost by the fraction of useful life consumed up to
date.
QUESTION 4
What is a "Limited Common Element" in a condominium property?
• A. A common element reserved for the exclusive use of one or
more, but less than all, unit owners (e.g., assigned balconies or
parking stalls)
• B. A private room owned exclusively by the developer forever
• C. A public municipal street maintained by the city government
• D. An area where no residents or guests are ever allowed to walk
Correct Answer: A. A common element reserved for the exclusive use of
one or more, but less than all, unit owners (e.g., assigned balconies or
parking stalls)
Detailed Rationale: Limited common elements are owned commonly by
all owners but designated for the exclusive physical use of specific
individual owners.
QUESTION 5
Which federal law prohibits discrimination in housing based on race,
color, religion, sex, familial status, national origin, or disability?
• A. The Fair Housing Act (FHA)
• B. The Occupational Safety and Health Act (OSHA)
• C. The National Labor Relations Act
, • D. The Fair Credit Reporting Act
Correct Answer: A. The Fair Housing Act (FHA)
Detailed Rationale: The FHA applies broadly to housing providers,
including community associations, prohibiting discrimination across
protected classes in sales, rentals, and services.
QUESTION 6
When an owner requests a reasonable accommodation under the Fair
Housing Act for an assistance animal in a strict "no pets" community,
what must the association do?
• A. Deny the request immediately and fine the owner $1,000.
• B. Review the request and grant a waiver if the individual has a
verifiable disability and a disability-related need for the animal.
• C. Require the owner to pay a $10,000 security deposit for the
animal.
• D. Evict the owner from the property within 24 hours.
Correct Answer: B. Review the request and grant a waiver if the
individual has a verifiable disability and a disability-related need for the
animal.
Detailed Rationale: Reasonable accommodations must be granted
under federal law when disability criteria are met, overriding standard
community pet restrictions.
QUESTION 7
What is the main purpose of an Association's Annual Budget?
