ROCKWELL PRACTICE EXAM WITH
CORRECT ANSWERS
1. A home inspection revealed that black bold is present in a home?
About should the buyer's agent tell the buyer? A. That black mold is
toxic and that the buyer should not buy the house B. That mold is
commonplace, and can be cleaned up with bleach C. To require the
seller to remedy the problem D. To seek expert advice - ANSWER-D. To
seek expert advice
2. A seller wants to net $60,000 from a transaction but will have to pay
off a mortgage and other fees, at a total cost of $181.800. The seller
will also need to pay a 7% commission. What will the property need to
sell for? A. $241,800 B. $258,726 C. $260,000 D. $276,060 - ANSWER-
C. $260,000 (Add the net + other costs -> $60,000 + $181,800 =
$241,800) Subtract the commission percentage from 100 (100 - 7 =
93) and then divide the total by that percentage ($241,.93 =
$260,000)
3. A buyer asks the buyer's agent to write an offer on terms that don't
match the listing agreement. They buyer's agent refuses to write the
offer and then, in writing, unliterally terminates the agency relationship
with the buyer. Which is true? A. A buyer's agent will be subject to
disciplinary action B. Buyer's agent is permitted to unilaterally
terminate the agency relationship C. Buyer's agent is allowed to
terminate the agency, but must write the offer before terminating D.
Buyer's agent is not permitted to write such an offer - ANSWER-B.
Buyer's agent is permitted to unilaterally terminate the agency
relationship
4. Closing is set for August 1. The seller has already paid the property
taxes for the year, totaling $6,000. How much of that amount is the
buyer's responsibility? A. $2,000 B. $2,500 C. $3,000 D. $3,500 -
ANSWER-B. $2,500 ($ months = 500. $500 x 5 months =
$2,500)
,5. The IRS issues rules that determine when a real estate agent is an
employee and when he is an independent contractor. Which of the
following statements of that topic is false? A. The brokerage may allow
an independent contractor to place her own ads but the ads must
conform with the firm's advertising rules B. The brokerage may require
an independent contractor to have a cell phone C. The brokerage will
take taxes from an employee's paycheck D. The brokerage will tell an
employee when to work certain hours - ANSWER-B. The brokerage may
require an independent contractor to have a cell phone
6. A tenant has already paid his $1,200 rent for the month for a single-
family property. The property's owner sells it to a new buyer with
closing occurring on the 15th of June. The parties decide that the seller
is entitled to rent for the closing date. On the settlement statement,
the prorated rent will appear as: A. $600 debit for the buyer and $600
credit to the seller B. $600 debit to the seller and $600 credit to the
buyer C. $1,200 credit for the buyer D. $1,200 credit for the seller -
ANSWER-B. $600 debit to the seller and $600 credit to the buyer
7. Mineral rights associated with real property are always A. conveyed
along with the surface rights to the property B. separable and divisible
C. sold separately from the property D. an interest in personal property
- ANSWER-B. separable and divisible
8. John, Kevin and Lyle own a property as tenants in common, but only
Kevin and Lyle live on the property. John would like to see the property
for redevelopment, but Kevin and Lyle refuse. What is John's best
option? A. Charge Kevin and Lyle rent B. Create a trust to manage the
property C. Evict Kyle and Lyle D. Obtain a court order to sell the
property - ANSWER-D. Obtain a court order to sell the property
9. W, age 17, enters into an installment contract to purchase a five-year-
old car from S, an adult. From a legal point of view, the contract is A.
, void B. voidable by W only C. voidable by S only D. voidable by either S
or W - ANSWER-B. voidable by W only
10. An investor wants to invest $250,000 in the development of a
strip mall by taking out a loan secured by a residential property that he
owns. Will the Truth in Lending Act apply to this transaction? A. Yes,
because the loan is for less than $500,000 B. Yes, because the loan is
secured by residential property C. No, because the loan is for more
than $50,000 D. No, because this is a commercial transaction -
ANSWER-D. No, because this is a commercial transaction
11. While preparing a competitive marketing analysis, an agent finds
four comparables to choose from. Comparable 1 sold for $180,000 13
months ago under normal conditions. Comparable 2 sold for $190,000
14 months ago under normal conditions. Comparable 3 sold for
$175,000 10 months ago as a foreclosure. Comparable 4 sold for
$180,000 16 months ago as a foreclosure. The agent should use A. the
oldest two B. the newest two C. all four D. none of them, because they
are all older than nine months - ANSWER-D. none of them, because
they are all older than nine months
12. An investor rents a property to a tenant. For tax purposes,
depreciation on this property is based on: A. market value, plus capital
improvements, minus the land value B. market value, plus rental
income, minus the land value C. price, plus capital improvements,
minus the land value D. price, plus rental income, minus the land value
- ANSWER-C. price, plus capital improvements, minus the land value
13. Property management for residential property is different from
property management for commercial property, in that a manager
would be more concerned about A. a written lease for residential
tenant than for a commercial tenant B. future space needs of a
commercial tenant than of a residential tenant C. The credit rating of a
commercial tenant than of a residential tenant D. the security deport of
a commercial tenant than of a residential tenant - ANSWER-B. future
space needs of a commercial tenant than of a residential tenant
CORRECT ANSWERS
1. A home inspection revealed that black bold is present in a home?
About should the buyer's agent tell the buyer? A. That black mold is
toxic and that the buyer should not buy the house B. That mold is
commonplace, and can be cleaned up with bleach C. To require the
seller to remedy the problem D. To seek expert advice - ANSWER-D. To
seek expert advice
2. A seller wants to net $60,000 from a transaction but will have to pay
off a mortgage and other fees, at a total cost of $181.800. The seller
will also need to pay a 7% commission. What will the property need to
sell for? A. $241,800 B. $258,726 C. $260,000 D. $276,060 - ANSWER-
C. $260,000 (Add the net + other costs -> $60,000 + $181,800 =
$241,800) Subtract the commission percentage from 100 (100 - 7 =
93) and then divide the total by that percentage ($241,.93 =
$260,000)
3. A buyer asks the buyer's agent to write an offer on terms that don't
match the listing agreement. They buyer's agent refuses to write the
offer and then, in writing, unliterally terminates the agency relationship
with the buyer. Which is true? A. A buyer's agent will be subject to
disciplinary action B. Buyer's agent is permitted to unilaterally
terminate the agency relationship C. Buyer's agent is allowed to
terminate the agency, but must write the offer before terminating D.
Buyer's agent is not permitted to write such an offer - ANSWER-B.
Buyer's agent is permitted to unilaterally terminate the agency
relationship
4. Closing is set for August 1. The seller has already paid the property
taxes for the year, totaling $6,000. How much of that amount is the
buyer's responsibility? A. $2,000 B. $2,500 C. $3,000 D. $3,500 -
ANSWER-B. $2,500 ($ months = 500. $500 x 5 months =
$2,500)
,5. The IRS issues rules that determine when a real estate agent is an
employee and when he is an independent contractor. Which of the
following statements of that topic is false? A. The brokerage may allow
an independent contractor to place her own ads but the ads must
conform with the firm's advertising rules B. The brokerage may require
an independent contractor to have a cell phone C. The brokerage will
take taxes from an employee's paycheck D. The brokerage will tell an
employee when to work certain hours - ANSWER-B. The brokerage may
require an independent contractor to have a cell phone
6. A tenant has already paid his $1,200 rent for the month for a single-
family property. The property's owner sells it to a new buyer with
closing occurring on the 15th of June. The parties decide that the seller
is entitled to rent for the closing date. On the settlement statement,
the prorated rent will appear as: A. $600 debit for the buyer and $600
credit to the seller B. $600 debit to the seller and $600 credit to the
buyer C. $1,200 credit for the buyer D. $1,200 credit for the seller -
ANSWER-B. $600 debit to the seller and $600 credit to the buyer
7. Mineral rights associated with real property are always A. conveyed
along with the surface rights to the property B. separable and divisible
C. sold separately from the property D. an interest in personal property
- ANSWER-B. separable and divisible
8. John, Kevin and Lyle own a property as tenants in common, but only
Kevin and Lyle live on the property. John would like to see the property
for redevelopment, but Kevin and Lyle refuse. What is John's best
option? A. Charge Kevin and Lyle rent B. Create a trust to manage the
property C. Evict Kyle and Lyle D. Obtain a court order to sell the
property - ANSWER-D. Obtain a court order to sell the property
9. W, age 17, enters into an installment contract to purchase a five-year-
old car from S, an adult. From a legal point of view, the contract is A.
, void B. voidable by W only C. voidable by S only D. voidable by either S
or W - ANSWER-B. voidable by W only
10. An investor wants to invest $250,000 in the development of a
strip mall by taking out a loan secured by a residential property that he
owns. Will the Truth in Lending Act apply to this transaction? A. Yes,
because the loan is for less than $500,000 B. Yes, because the loan is
secured by residential property C. No, because the loan is for more
than $50,000 D. No, because this is a commercial transaction -
ANSWER-D. No, because this is a commercial transaction
11. While preparing a competitive marketing analysis, an agent finds
four comparables to choose from. Comparable 1 sold for $180,000 13
months ago under normal conditions. Comparable 2 sold for $190,000
14 months ago under normal conditions. Comparable 3 sold for
$175,000 10 months ago as a foreclosure. Comparable 4 sold for
$180,000 16 months ago as a foreclosure. The agent should use A. the
oldest two B. the newest two C. all four D. none of them, because they
are all older than nine months - ANSWER-D. none of them, because
they are all older than nine months
12. An investor rents a property to a tenant. For tax purposes,
depreciation on this property is based on: A. market value, plus capital
improvements, minus the land value B. market value, plus rental
income, minus the land value C. price, plus capital improvements,
minus the land value D. price, plus rental income, minus the land value
- ANSWER-C. price, plus capital improvements, minus the land value
13. Property management for residential property is different from
property management for commercial property, in that a manager
would be more concerned about A. a written lease for residential
tenant than for a commercial tenant B. future space needs of a
commercial tenant than of a residential tenant C. The credit rating of a
commercial tenant than of a residential tenant D. the security deport of
a commercial tenant than of a residential tenant - ANSWER-B. future
space needs of a commercial tenant than of a residential tenant
