CA Real Estate Salesperson Exam Preparation Test

50 Questions | Total Attempts: 2068

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CA Real Estate Salesperson Exam Preparation Test

Are you living in California state and aspiring to become a real estate salesperson? You need to clear the final exam first, and that is not going to be easy anyway. It would help if you had a solid preparation and knowledge of all the concepts, laws, and policies. This test provides you material for clearing out the final exam.


Questions and Answers
  • 1. 
    A real estate broker is reviewing a profit and loss statement for an apartment house, which lists expenses under the headings shown below. Under which heading would she most likely find taxes and fire insurance?
    • A. 

      Fixed expenses

    • B. 

      Operating expenses

    • C. 

      Capital expenses

    • D. 

      Other expenses

  • 2. 
    A prospect is considering the purchase of an income property which has an operating statement showing $94,500.00 deducted from gross income to arrive at the net income. The deductions amount to 60% of the gross income. If the prospect wants a 12 1/2% return on the purchase price of any investment he makes, what should he pay for the property?
    • A. 

      $81,000

    • B. 

      $196,000

    • C. 

      $504,000

    • D. 

      $720,000

  • 3. 
    The Mt. Diablo meridian line runs:
    • A. 

      East and West

    • B. 

      The same as township lines

    • C. 

      North and South

    • D. 

      North

  • 4. 
    Master sold his residence which was unencumbered. Total deductions in escrow amounted to $215.30 in addition to a broker's commission of 6% of the selling price. The selling price was the only credit item. Masters received a check from escrow amounting to $15,290. The selling price was most nearly:
    • A. 

      $16,200

    • B. 

      $16,266

    • C. 

      $16,430

    • D. 

      $16,485

  • 5. 
    When a home has been kept in better than average condition, the effective age compared to the actual age would be:
    • A. 

      Less

    • B. 

      More

    • C. 

      The same

    • D. 

      Non of the above

  • 6. 
    A single family dwelling that is considered to be an improper improvement in relation to its site suffers a loss in value described as:
    • A. 

      Incurable location obsolescence

    • B. 

      Curable functional obsolescence

    • C. 

      Incurable functional obsolescence

    • D. 

      Curable physical obsolescence

  • 7. 
    Which of the following would help to prevent economic obsolescence on an income property?
    • A. 

      All of the surrounding properties are prospering

    • B. 

      Proper management of the income property

    • C. 

      Excellent maintenance on the building

    • D. 

      All of the above

  • 8. 
    Mr. and Mrs. Smith acquired a home in 1977 for $48,000. Some years later they sold their home for $60,500 and moved into an apartment unit. During the ten year period of ownership, permanent improvements totaling $12,750 were made to their house. If Mr. Smith's income consisted entirely of wages, how would the sale of the home affect his federal income tax return in the year of sale?
    • A. 

      No affect

    • B. 

      $125.00 loss

    • C. 

      $250.00 loss

    • D. 

      $12,500 gain

  • 9. 
    As a matter of good business practice, a real estate licensee should inform the buyer that as soon as the deed is recorded, they should file a change of ownership statement with the county tax assessor within:
    • A. 

      15 days

    • B. 

      30 days

    • C. 

      45 days

    • D. 

      60 days

  • 10. 
    Mayer sold his house and took back a note for $4,200 secured by a second deed of trust. He promptly sold the note for $2,730. This represents a discount of:
    • A. 

      28%

    • B. 

      35%

    • C. 

      55%

    • D. 

      65%

  • 11. 
    An owner depreciated an improvement based on a cost basis of $160,000, using the straight-line method. The improvements have been depreciated 37.5% to date and the remaining economic life is estimated to be 15 years. Which of the following is a correct statement? The:
    • A. 

      Rate of depreciation exceeds 4% per annum

    • B. 

      Time of depreciation to date is over 10 years

    • C. 

      Present book value of the building is $120,000

    • D. 

      Rate of depreciation cannot be determined from the data given

  • 12. 
    A duplex with a fair market value of $120,000 and an outstanding $80,000 loan balance, was exchanged for a four plex with a market value of $195,000 and an outstanding $146,000 loan balance. The owner of the duplex would pay in cash or secondary financing most nearly:
    • A. 

      $6,100

    • B. 

      $8,100

    • C. 

      $9,100

    • D. 

      $15,100

  • 13. 
    In single-family house construction the term "footing" refers to:
    • A. 

      A beam under the floor boards

    • B. 

      A girder, running along the foundation, to which the ends of the floor boards are fixed

    • C. 

      The spreading part at the base of the foundation wall or pier

    • D. 

      Reinforced concrete slab over which asphalt tile may be laid

  • 14. 
    In order for it to become effective and to transfer title, a deed must:
    • A. 

      Be acknowledged

    • B. 

      Be executed on a day other than Sunday

    • C. 

      Have a proper description of the property

    • D. 

      Contain the phrase "To have and to hold"

  • 15. 
    To alienate title to property one:
    • A. 

      Secures an ALTA policy of the title insurance

    • B. 

      Clouds the title

    • C. 

      Records a homestead

    • D. 

      Conveys title

  • 16. 
    Because of the long term nature of their assets, investments in amortized real estate loans make particularly good investments for:
    • A. 

      National banks

    • B. 

      Credit Unions

    • C. 

      Life insurance companies

    • D. 

      Individuals

  • 17. 
    Mrs. King borrowed money using a fully-amortized loan to finance the remodeling of her real property. If equal monthly payments include both principal and interest, the amount of the payment on the principal will:
    • A. 

      Increase at a constant amount

    • B. 

      Decline while the amount credited to interest increases

    • C. 

      Cause the amount credited to interest to remain constant

    • D. 

      Increase while the amount credited to interest decreases

  • 18. 
    When appraising a house built in 1910, the appraiser would use which of the following to estimate the cost new:
    • A. 

      A national cost index adjusted in 1910

    • B. 

      Actual cost of construction in 1910

    • C. 

      Current replacement or reproduction cost

    • D. 

      Current cost adjusted by the 1910 cost of living index

  • 19. 
    When a purchase money deed of trust is used to obtain a loan from an institutional lender, the trustor:
    • A. 

      Holds the deed of trust

    • B. 

      Receives a note for the amount borrowed

    • C. 

      Signs a note for the amount borrowed

    • D. 

      Loans the funds

  • 20. 
    The event for income tax purposes, where money is paid to an owner of real property that is taken as a result of condemnation proceedings, is known as:
    • A. 

      A tax free exchange

    • B. 

      Involuntary conversion

    • C. 

      Subrogation

    • D. 

      Economic obsolescence

  • 21. 
    During a period of time in which unemployment is declining and the gross national product is increasing:
    • A. 

      The value of single family residences would tend to increase in value

    • B. 

      New home sales would tend to increase

    • C. 

      Demand for existing housing would increase

    • D. 

      All of the above would be true

  • 22. 
    An owner of commercial property entered into separate open listing contracts with a number of different real estate brokers.  Under these circumstances, each broker will:
    • A. 

      Have an opportunity to earn a full commission if he or she is the procuring cause

    • B. 

      Equally share the commission if any one of the brokers sells the property

    • C. 

      Earn a full commission if the owner sells the property herself

    • D. 

      Have the right to exercise an option to purchase the property at the listed price

  • 23. 
    Irons, a 15 year old emancipated minor, entered into a listing with a broker to sell real property that he owned.  When the broker finds a buyer and both parties have signed a purchase contract, the broker should obtain proof of the emancipation to satisfy the demands of the:
    • A. 

      Escrow holder

    • B. 

      Title company

    • C. 

      Buyer

    • D. 

      Buyer's broker

  • 24. 
    The relationship of the escrow holder to the parties in the sale and purchase of real property is that of an:
    • A. 

      Advocate

    • B. 

      Independent contractor

    • C. 

      Employee

    • D. 

      Agent

  • 25. 
    Most of the junior loans that are available today are secured through:
    • A. 

      Savings and loan associations

    • B. 

      Private Investors

    • C. 

      Commercial Banks

    • D. 

      Mortgage bankers