CA Real Estate State Exam Crash Course - Questions
With Proved Solutions
How are ownership rights and interest in real property established by way of
a court proceeding?
A - cloud on title
B - equitable use
C- quiet title action
D - quitclaim Right Ans - C - quiet title action
Answer Feedback: A quiet title action is proceeding to establish an
individual's right to ownership of real property against one or more adverse
claimants.
The recording of an instrument gives:
A - actual notice
B - passive notice
C - absolute notice
D - constructive notice Right Ans - D - constructive notice
Answer Feedback: Constructive notice is given by taking physical possession
or by recording an instrument.
Federal income tax rates on ordinary income are:
A - progressive
B - equal
C - flat
D - digressive Right Ans - A - progressive
Answer Feedback: The more you make, the more you are taxed.
When title of a property is voluntary transferred without any money
consideration, this would be considered:
A - avulsion
,B - eminent domain
C - a gift
D - foreclosure Right Ans - C - a gift
Answer Feedback: This describes a gift which is the only right choice of a
voluntary transfer without consideration (money).
A single family home that had an assessed value that was much lower than the
current market value was sold on November 3rd at its current market value.
What will the new owners have to pay?
A - supplement tax based on the difference between the old assessed value
and the new assessed value for the remaining fiscal year
B - nothing
C - a prorated amount of tax
D - a flat tax of 10% Right Ans - A - supplement tax based on the difference
between the old assessed value and the new assessed value for the remaining
fiscal year
Answer Feedback: When a property is sold for more than the assessed value,
the new buyer will receive a supplemental tax bill based on the new assessed
value.
An income property owner was figuring out their net income for tax purposes.
They took the gross income and deducted certain expenses. What cannot be
deducted?
A - management expenses
B - cost of a fence
C - interest for a loan
D - depreciation Right Ans - B - cost of a fence
Answer Feedback: A fence is a capital improvement and cannot be deducted
as an expense for tax purposes.
When referring to a building bought for income purposes, the owner can
deduct all of the following for income tax purposes, except:
A - loss of rental due to vacancies
,B - depreciation when the property value increases
C - interest payments on the second trust deed
D - cost of repairing the vacant units Right Ans - A - loss of rental due to
vacancies
Answer Feedback: Vacancy losses cannot be deducted from income.
A sale leaseback purchaser would be least concerned about the:
A - depreciated value of the building
B - condition of the improvement
C - location of the property
D - creditworthiness of the tenant Right Ans - A - depreciated value of the
building
Answer Feedback: Depreciated value has to do with the adjusted costs basis of
the building.
Why can a corporation not qualify as a "joint tenant" for ownership interest of
real property?
A - A corporation can be foreign or domestic
B - Only community property can be held as joint tenancy
C - It has perpetual existence
D - A corporation has a board of directors Right Ans - C - It has perpetual
existence
Answer Feedback: Corporations don't die and since one of the characteristics
of joint tenancy is the right of survivorship, a corporation owning real
property in "joint tenancy" would be an unfair advantage. Death is a
requirement.
The assessment roll in real property taxes exists to establish the tax base. Who
sets the county tax rate?
A - The board of supervisors
B - The county assessor
C - The state assessor
D - The federal government Right Ans - A - The board of supervisors
, Answer Feedback: The board supervisors of each county sets the maximum
annual tax on real property.
Which of the following is not an example of police power by the government?
A - eminent domain
B - zoning
C - the right to tax
D - adopt and enforce laws Right Ans - C - the right to tax
Answer Feedback: Eminent domain requires a payment of just compensation
for private property. Taking it under the police power (such as zoning) does
not require compensation.
The Williamson Act was created to:
A - preserve agricultural land in California
B - assist low-income families with down payment assistance
C - provide appraisers with government sponsored classes
D - lawfully convict lenders involved in kickback schemes Right Ans - A -
preserve agricultural land in California
The Williamson Act was created in 1965 to benefit:
A - farmland owners by providing them with lower property taxes
B - low-income families with down payment assistance
C - real estate licensees requiring emergency funds
D - landlords during difficult tenant evictions Right Ans - A - farmland
owners by providing them with lower property taxes
When a licensee acts as a buyer's agent on a home listed by their broker, the
broker has a fiduciary duty to:
A - the parties involved
B - the buyer
C - the seller
D - the person who writes the check Right Ans - C - the seller
With Proved Solutions
How are ownership rights and interest in real property established by way of
a court proceeding?
A - cloud on title
B - equitable use
C- quiet title action
D - quitclaim Right Ans - C - quiet title action
Answer Feedback: A quiet title action is proceeding to establish an
individual's right to ownership of real property against one or more adverse
claimants.
The recording of an instrument gives:
A - actual notice
B - passive notice
C - absolute notice
D - constructive notice Right Ans - D - constructive notice
Answer Feedback: Constructive notice is given by taking physical possession
or by recording an instrument.
Federal income tax rates on ordinary income are:
A - progressive
B - equal
C - flat
D - digressive Right Ans - A - progressive
Answer Feedback: The more you make, the more you are taxed.
When title of a property is voluntary transferred without any money
consideration, this would be considered:
A - avulsion
,B - eminent domain
C - a gift
D - foreclosure Right Ans - C - a gift
Answer Feedback: This describes a gift which is the only right choice of a
voluntary transfer without consideration (money).
A single family home that had an assessed value that was much lower than the
current market value was sold on November 3rd at its current market value.
What will the new owners have to pay?
A - supplement tax based on the difference between the old assessed value
and the new assessed value for the remaining fiscal year
B - nothing
C - a prorated amount of tax
D - a flat tax of 10% Right Ans - A - supplement tax based on the difference
between the old assessed value and the new assessed value for the remaining
fiscal year
Answer Feedback: When a property is sold for more than the assessed value,
the new buyer will receive a supplemental tax bill based on the new assessed
value.
An income property owner was figuring out their net income for tax purposes.
They took the gross income and deducted certain expenses. What cannot be
deducted?
A - management expenses
B - cost of a fence
C - interest for a loan
D - depreciation Right Ans - B - cost of a fence
Answer Feedback: A fence is a capital improvement and cannot be deducted
as an expense for tax purposes.
When referring to a building bought for income purposes, the owner can
deduct all of the following for income tax purposes, except:
A - loss of rental due to vacancies
,B - depreciation when the property value increases
C - interest payments on the second trust deed
D - cost of repairing the vacant units Right Ans - A - loss of rental due to
vacancies
Answer Feedback: Vacancy losses cannot be deducted from income.
A sale leaseback purchaser would be least concerned about the:
A - depreciated value of the building
B - condition of the improvement
C - location of the property
D - creditworthiness of the tenant Right Ans - A - depreciated value of the
building
Answer Feedback: Depreciated value has to do with the adjusted costs basis of
the building.
Why can a corporation not qualify as a "joint tenant" for ownership interest of
real property?
A - A corporation can be foreign or domestic
B - Only community property can be held as joint tenancy
C - It has perpetual existence
D - A corporation has a board of directors Right Ans - C - It has perpetual
existence
Answer Feedback: Corporations don't die and since one of the characteristics
of joint tenancy is the right of survivorship, a corporation owning real
property in "joint tenancy" would be an unfair advantage. Death is a
requirement.
The assessment roll in real property taxes exists to establish the tax base. Who
sets the county tax rate?
A - The board of supervisors
B - The county assessor
C - The state assessor
D - The federal government Right Ans - A - The board of supervisors
, Answer Feedback: The board supervisors of each county sets the maximum
annual tax on real property.
Which of the following is not an example of police power by the government?
A - eminent domain
B - zoning
C - the right to tax
D - adopt and enforce laws Right Ans - C - the right to tax
Answer Feedback: Eminent domain requires a payment of just compensation
for private property. Taking it under the police power (such as zoning) does
not require compensation.
The Williamson Act was created to:
A - preserve agricultural land in California
B - assist low-income families with down payment assistance
C - provide appraisers with government sponsored classes
D - lawfully convict lenders involved in kickback schemes Right Ans - A -
preserve agricultural land in California
The Williamson Act was created in 1965 to benefit:
A - farmland owners by providing them with lower property taxes
B - low-income families with down payment assistance
C - real estate licensees requiring emergency funds
D - landlords during difficult tenant evictions Right Ans - A - farmland
owners by providing them with lower property taxes
When a licensee acts as a buyer's agent on a home listed by their broker, the
broker has a fiduciary duty to:
A - the parties involved
B - the buyer
C - the seller
D - the person who writes the check Right Ans - C - the seller
