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California Real Estate Practice Practice Exam

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1 of 50 - Sal bought a personal residence for $150,000. He made $150,000 of improvements during the three years he lived in it before he sold it. He sold the home for $750,000 and paid $50,000 in sel ... ling expenses, including the broker's commission. On what amount will he pay capital gains tax? $150,000 You answered incorrectly Remember that there is a $250,000 exclusion on capital gains tax for the sale of an individual's personal residence. So, $750,000 sale price – ($150,000 + $150,000) = $450,000 - $50,000 selling expenses = $400,000 - $250,000 exclusion = $150,000 capital gain to be taxed. 2 of 50 - Which of the following would not qualify as a 1031 exchange? A rental condominium for a recreational vehicle You answered correctly 3 of 50 - When doing research to recommend a reasonable listing price for a home, the most critical part of the research deals with analyzing: Selling prices of recently sold homes You answered correctly 4 of 50 - Which of the following is a credit to the seller on the settlement statement? Sales price You answered correctly 5 of 50 - Alex makes an offer to purchase one of Bill’s listings. Bill cannot contact the seller. In the meantime, Bill gets another offer on the property from another buyer at a higher price. What should Bill do? Present both offers to the seller. You answered correctly 6 of 50 - Greg grew up in and lives in a rural area. He’s very comfortable selling that type of property and knows he can work well with clients in that area. What property type will be his specialty? Agricultural You answered correctly [Show More]

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