A Career in Real Estate 1. All of the following terms have something in common except: clearance receipt state Board of Equalization successor liability Real Estate Commissioner None Hint 2. Which of the following is true? a regional shopping center requires a population of 200,000 or more a community shopping center would be supported by a population of 100,000 or less a samll neighborhood shopping center requires 7,000 to 18,000 population all of these are true None 3. A valid bill of sale does not require: the vendee's signature documentary stamps a notary seal and recording any of these None 4. For a fee, Thomas offers to assist Sara in leasing and/or purchasing federal land. Thomas cannot charge a fee Thomas must be a broker Thomas is subject to DRE discipline both a and c are true None Hint 5. The notice required under the Bulk Sales Act need not include: the name of the seller a description of the property the sale price and terms the date and place of the sale None Hint 6. The successor liability of a business refers to: unpaid prior debts for inventory collected but unpaid sales tax pending lawsuits all of these None Hint 7. A three-month period for accounting applies to: trust deeds advance fee brokers trust account balances real property security sales None 8. The term short-rate describes an: insurance refund when the company cancels interest table for short-term loans insurance refund when the insured cancels none of these None Hint 9. A business balance sheet might include all except: goodwill inventory gross sales accounts payable None Hint 10. An unlicensed assistant can: show a listing sit an open house explain benefits of a property do none of the above None Hint 11. Liquidity of a firm would be best described as the ratio of: cash to total indebtedness total assets to total liabilities current assets to current liabilities income to expenses None Hint 12. If you were planning a suburban shopping center, one of the first things you would consider is: the purchasing power of the area the population competition location None 13. When a business is being sold, the term successor liability may become inportant. Real Estate brokers know that this term incolves certain obligations to the: Department of Alcoholic Beverage Control secretary of state Department of Corporations state Board of Equalization None 14. The maximum sale price for resale of a general off-sale license originally issued in July 1, 1959, when the current owner has had the license for only one year, is: $600 $6,000 $1,000 there is no limit None Hint 15. Balancing a bank statement with an account is known as: auditing taking a trial balance reconciliation none of these None Hint 16. A balance sheet shows: operational detail net worth profit or loss sale value None Hint 17. A balance sheet would not show: accounts receivable operating expenses inventory value of fixtures None Hint 18. A broker may not: employ licensed salespeople on a salary basis hire other brokers to work as salespeople hire unlicensed persons to solicit listings pay a commission to a broker in another state who sent him or her a client None Hint 19. The Franchise Investment Law could best be described as: a law that regulates franchisors' activities a disclosure law both a and b neither a nor b None 20. The least desirable business in a shopping center would be a: sporting goods store supermarket real estate office drugstore None Hint 21. A profit-and-loss statement would not include: operating expenses gross receipts interest charges value of fixtures None Hint 22. You must have a sales tax permit if you are going to: engage in retail sales engage in wholesale sales either a or b neither a nor b None 23. Notice of an intended sale of a business is recorded and published a day prior to sale. The sale is: void as to the vendor's creditors illegal void none of these None Hint 24. Real estate licenses are issued for: one year two years four years life None 25. To serve process on a nonresident California licensee who is not in California, a person would serve upon: the Department of Real Estate the applicable district attorney the California secretary of state none of these None 26. In considering a community shopping center, a developer would be most interested in: raw population figures traffic patterns topography purchasing power of the area None Hint 27. Sales taxes normally are required to be remitted to the state Board of Equalization: weekly monthly quarterly when requested None Hint 28. A salesperson's commission is paid by: the seller the broker escrow the buyer None 29. An advance fee is: prepayment of a commission a bonus to a broker to accept a listing prepayment of promotional costs in a paper or magazine devoted primarily to describing properties to sale prepayment of regular newspaper ads None 30. Accounts payable of a business would be: an asset a liability a prorated item for escrow none of these None 31. A large feed wholesaler wishes to sell 100,000 pounds of bulk feed to a dealer. He or she should comply with: the Bulk Sales Act the Franchise Investment Law both a and b neither a nor b None Hint 32. A liquor license must be put in use within __ days of initial issuance. 10 30 60 90 None 33. A real estate salesperson may not: take a listing for the broker take a deposit on the broker's listing agree in writing to work for a one percent commission accept a commission directly from another broker None Hint 34. The state Board of Equalization: appraises public utilities for property tax checks county assessors as to the uniformity of their assessments collects state sales tax all of these None 35. Dividing office overhead by the number of salespersons give: broker dollar desk cost company dollar operational ratio None 36. A use tax is: a listing on a sales price a form of income tax a tax on tenants none of these None 37. An on-sale liquor license may be transferred: from person to person from premises to premises both a and b neither a nor b None 38. The term cash flow refers to: the amount of profit on a rental the amount of money received the length of time it takes to recover on an investment the difference between receipts and all cash expenses None Hint 39. The most reliable income figure for a grocery store that is for sale would be: the figure on the listing the figures from the owner's income tax returns the broker's estimate sales tax paid None Hint 40. To sell franchise opportunities, a person must be: the owner of a basic franchise a real estate broker a licensed corporate security dealer any of these None 41. The least important element of goodwill is: store policies knowledgeable and pleasant employees advertising history a modern store None 42. Which of the following indicates an organization of brokers founded in 1947? NAR CAR Realtists none of these None Hint 43. Which of the following cannot obtain an alcoholic beverage license? an unmarried woman a person with an arrest record a minor all of these None 44. Which of the following would be concerned with obtaining a clearance receipt in the sale of a business? the vendor the lienholder the state Board of Equalization the vendee None Hint 45. To be enforceable, listings of business opportunities: must always be in writing never have to be in writing do not always have to be in writing must be exclusive None 46. General liquor licenses less than five years old cannot be resold for more than: $6,000 $500 $10,000 there is no limit on the sale price None 47. A salesperson leaves a broker. The broker must notify the Real Estate Commissioner: immediately within five working days before the broker's license renewal not at all - it is the duty of the new broker None Hint 48. Subtracting the cost of merchandise from gross sales gives: net profit gross sales adjusted gross sales gross profit None Hint 49. Which of the following needs a real estate license? an attorney-in-fact selling property for his or her principal an executor of an estate disposing of real property an attorney taking a listing none of these None Hint 50. State sales tax on the fixtures of a business being sold would never be: collectect by the seller and remitted with his or her sales tax sent directly to the state Board of Equalization waived by the transferor all of these None 51. Roland, a broker, makes a sale. His license is later revoked. After a revocation, escrow is completed. a commission goes to the Real Estate Education Research and Recovery Fund the seller does not have to pay the commission the commission is split between the buyer and the seller Roland gets his commission None 52. A real estate license was issued for only 150 days. The reason for this license period was that: educational requiements were incomplete the licensee was a foreign national licensed for a single transaction the licensee was not yet of legal age the licensee was delinquent in child support payments None Hint 53. The capital turnover of a real estate investor is __ that of the average vendor. about the same as slightly more than slightly less than much less thna None Hint 54. The Franchise Investment Law requires: a franchisor to registor sales disclosures in an offering prospectus both a and b neither a nor b None 55. A broker who uses a send-out slip: must have written permission from the prospective buyer must have written permission from the owner is violating the Real Estate Law none of these None 56. A licensee with a restricted license may be restricted by the Commissioner as to: the term and area of activity the number of sales the amount of commission none of these None 57. Colonel Cluck wishes to open franchise stores in California. They have had 25 franchises operating for five years in Arizona. Their net worth is in excess of $5,000,000. They must: register with the Corporations Commissioner post a $10,000 fidelity bond both a and b neither a nor b None Hint 58. An advance-fee rental agent must: be a real estate broker return all over the first $10 of the fee if a rental is not obtained confirm availability of rentals at least seven days prior to providing the information give a prospective tenant a writeen contract None 59. A certificate of resale is: required from the merchant to avoid sales tax required by law when used goods are sold a limitation on personal property tax provided by the purchaser None Hint 60. In a sale of a business, sales tax would not be paid on: stock in trade fixtures both a and b neither a nor b None Hint 61. Turnover refers to: the number of times a business is sold the number of times an inventory is sold dollar volume none of these None 62. Which of the following incomes would be the highest? adjusted gross income scheduled gross income net spendable income adjusted net income None Hint 63. A retailer can: show the sales tax separately when pricing goods absorb the sales tax set his or her accounting period for remitting collected sales tax to the state Board of Equalization none of these None Hint 64. Goodwill costs for an on-sale or off-sale general alcoholic beverage license less than five years old cannot exceed: $6,000 average monthly sales based on the previous 12 months's sales $1,000 none of these None 65. The ABC will not issue an alcoholic beverage license to: a social or fraternal organization established two months ago a married woman an alien a seasonal resort None Hint 66. Accounts payable are in the same accounting category as: accounts receivable cash on hand prepaid insurance bank loans None Hint 67. To have any effect, a bill of sale must: be signed by the vendee describe the property be acknowledged by the vendor be acknowledged by the vendee None 68. Since there are county and state sales taxes: the state collects both and remits a portion to the county merchants must pay the state and county separately merchants may, at their option, pay the entire tax to the state Board of Equalization none of these, since there is no county tax None 69. The California State Sales Tax is: 6.25 percent 7.25 percent 7.5 percent 8.25 percent None Hint 70. Requirements for licensing as a real estate salesperson includes all except: property ownership being 18 years or older be honest and truthful be fingerprinted None 71. Terri does not require a real estate license if: she is an employee of a property management firm and rents apartments she employs a real estate salesperson to sell her property she charges a flat fee rather than a commission her commission agreements are verbal None 72. Property sold in a bulk sale would be transferred by: a financing statement a bulk sales agreement a bill of sale none of these None Hint 73. A person passing the real estate examination must apply for a license within: one year of the examination one year of notification of passing six months of the examination six months of notification of passing None 74. The company dollar refers to the: portion of the commission that the broker is entitled to gross commission less office overhead net income before taxes net income after taxes None 75. A right to use a marketing plan would be described as a(n): chain operation franchise license easement None 76. The goodwill value of a business can be computed by: subtracting the value of stock, fitures, and leases from the sale price subtracting net from the sale price $1.00 none of these None 77. An unlicensed assistant can properly: show property to prospective buyers encourage a party to use the broker's services discuss terms or conditions of a possible sale prepare a Competitive Market Analysis None 78. A real estate broker's ad must include: the name of the broker that the advertiser is a broker or agent the address of the broker either a or b None 79. Walter, a broker in California, pays a commission to Rita, a broker in Wisconsin who sent him a client. Walter can be fined $450 Walter can have his license revoked. both a and b neither a nor b is true None Hint 80. The license of a salesperson working at a branch office is held: at the branch office with the Real Estate Commissioner at the broker's primary place of business in the pocket or purse of the sales person None 81. Notice of intent to engage in the sale of alcoholic beverages must be posted on the premises for at least: 5 consecutive days 10 consecutive days 30 consecutive days 90 consecutive days None 82. George manages and leases five separate properties for an out-of-state owner, getting an apartment furnished at one of the locations as part payment for the work. George needs a real estate license George must be a CPM both a and c are true George does not need a real estate license None Hint 83. A listing of buildings and outbuildings would most likely be required for a: grant deed title insurance policy fire insurance policy land contract None 84. Turn-key project refers to: a franchise sale a purchase and resale a resale before taking possession construction of a property from groundbreaking to completion None 85. An unlicensed secretary in a real estate office can: sit open houses type listings adn sales contracts for licenses hand out brochures all of these None 86. Robert, a developer who is unlicensed, hires Yvonne, a broker, to sell his property. While Yvonne is out of town, Robert shows property, quotes prices, and makes sales. Yvonne can be fined $500 Yvonne can be fined $50 Robert has violated the Real Estate Law neither Robert nor Yvonne has done anything wrong None Hint 87. The financing statement for personal property in the sale of the business would most likely be filed with the: Department of Alcoholic Beverage Control secretary of state Real Estate Commissioner Bulk Sales Commission None 88. One year ago, Judy received an on-sale general liquor license from the state. She wishes to sell to Greg. The most she can get for the license is: $500 $5,000 $6,000 there is no limit None Hint 89. After publication has been made of a sale, the earliest the business can safety be sold is: immediately 5 days 12 days 30 days None Hint 90. Phil pays the Department of Alcoholic Beverage Control $6,000. he is buying a general, off-sale, or on-sale license from a licensee he is applying for a new general, off-sale, or on-sale license either a or b is true neither a nor b is true None Hint 91. Jane purchases a car in Oregon and wishes to license it in California. She is going to be taxed. This tax based on value is: a sales tax a use tax an ownership tax none of these None Hint 92. By checking a profit and loss statement, you would find: net worth book value operational results none of these None Hint 93. To obtain a real estate broker's license under the law, which of the following is required? a verification a state civil service examination an affirmation a written examination None 94. The Bulk Sales Act is part of the: Commissioner's regulations Real Estate Code Uniform Commercial Code Corporation Code None 95. Accounts payable on a balance sheet would show up as: a liability an asset both a and b neither a nor b None 96. Which of the following properties is likely to have the highest degree of liquidity? single-family residence residential income property raw land commercial property None Hint 97. The most important element of goodwill is: attitude of employees value of stock previous volume habit of patronage None 98. Licensees for on-sale and off-sale alcoholic beverage licenses must be fingerprinted, with the exception of: corporate officers having management duties partners having only slight management duties wives when the husband is also a licensee none of these None Hint 99. Which of the following would not be transferred by a bill of sale? good will fixtures lease stock in trade None Hint 100. A prospective renter paid $300 for a list of rentals. Since a rental was not obtained, the prospective renter asked for the return of the fee seven days later. The agent must return: nothing $25 $50 $250 None Hint 101. The acid-test ratio for cash on hand (includes securities readily converted to cash) to current liabilities is: 1:1 1:5 2:1 1:2 None Hint 102. Sales tax would not be collected on: fresh produce prescription medicine groceries any of these None 103. One year after his real estate license expired, Henry renewed the license. Which of the following is a true statement? Henry had to retake his license examination Henry would be issued a 150-day Until the license was renewed, Henry as precluded from activities requiring a license Henry's license is conditional None Hint 104. What a person pays to develop a property is known as: price value assessment cost None Hint 105. As to the sale of a business in which the Bulk Sales Act Requirements have not been met, which of the following is true? the sale is valid as to the buyer and the seller transfer is not enforceable by the parties the sale is void the sale is illegal None Hint 106. Compliance with the Bulk Sales Act requires publication at least 12 days prior to the sale in: a paper of record a paper within the same county where the property is located a paper of general circulation within the judicial district where the property is located any of these None 107. Which of the following is true? every real estate broker must maintain a definite place of business in California a salesperson's advertisements must include the broker's name both a and b neiher a nor b None 108. A $6,000 fee is: the annual fee for a general on-sale license the annual fee ofr a general off-sale license both a and b neither a nor b None Hint 109. A fictitious name statement expires: five years from abandonment five years from recordation five years from December 31 of the year recorded none of these None 110. A liability of a business would be: uncollectable accounts receivable prepaid insurance value of fixed assets none of these None Hint 111. An auctioneer who sells at auction and fails to comply with the Bulk Sales Act: is secondarily liable to creditors is personally liable to creditors of the vendor is an agent and as such is not liable unless he or she agreed to be personally responsible for compliance is liable only if he or she proceeded with the auction knowing of the noncompliance None 112. A detailed listing of the physical assets of a business would be found in a(n): profit-and-loss statement balance sheet listing inventory sheet None 113. In choosing a location for an office a broker should be most interested in: the rent the broker's goals traffic court area values None 114. The term liabilities of a business refers to: balances of debtors claims of creditors accounts receivable prepaid insurance None Hint 115. As to a business, which of the following is false? assets minus liabilities = net worth income minus expenses = profit expenses plus profit = gross income gross income minus profit = net None 116. A business owner fails to remit $1,000 in collected sales tax in a timely manner. He is also guilty of fraud. The maximum penalty he can be assessed is: $350 $500 $1,000 $50,000 and/or up to five years in prison None Hint 117. A broker's salespeople are under contract as independent contractors rather than employees. By doing so the brokers will save out of pocket expenses relating to: errors and omissions insurance workers compensation insurance social security advertising None Hint 118. A balance sheet would show: retail value of inventory wholesale value of inventory volume of sales operating expenses None 119. An alcoholic beverage license will be issued: for a location adjoining a public school for a location where it can be expected to cause traffic difficulties to a person who has no specific location where he or she intends to conduct business only after the licensee has been fingerprinted None Hint 120. Advance-fee broker advertising must be submitted to the Real Estate Commissioner __ days prior to use. 5 7 10 30 None
