** Chapter 14 - Gold Coast Real Estate Homework

How is an earnest money deposit held in escrow reflected on the closing statement? (a) Credit to the buyer (b) Debit to the buyer (c) Credit to both the buyer and seller (d) Credit to the seller

(a) Credit to the buyer

How is the amount of a mortgage loan assumed at closing by the buyer entered on the closing statement? (a) Double entry (b) Single entry (c) Credit to the seller (d) Debit to the buyer

(a) Double entry

What is the purpose of the closing statement? (a) To summarize the financial aspects of a real estate transaction (b) To determine the purchase price of the property (c) To determine which party pays the brokerage commission (d) To report income to the Internal Revenue Service

(a) To summarize the financial aspects of a real estate transaction

Which entry would normally appear as a debit on the buyer's statement? (a) First mortgage balance being assumed (b) Intangible tax on a new mortgage (c) Documentary stamps on the deed (d) Impound account balance when a loan is being assumed

(b) Intangible tax on a new mortgage

What document stipulates which party pays which expense in a closing? (a) Listing agreement (b) Purchase and sale contract (c) Deed (d) Mortgage

(b) Purchase and sale contract

Complete the statement. When determining prorations on a closing statement, the day of closing: (a) belongs to the closing agent. (b) is determined by agreement. (c) is the responsibility of the seller. (d) is charged to the buyer.

(b) is determined by agreement.

How is the amount of a new mortgage obtained by the buyer entered on the closing statement? (a) Debit to the buyer (b) Credit to the seller (c) Credit to the buyer (d) Debit to the seller

(c) Credit to the buyer

How are expenses that are paid to a third party entered on a closing statement? (a) Double entries (b) Credits (c) Debits (d) Prorations

(c) Debits

Which of the following statements best describes a single-entry item? (a) It appears on both the buyer's and seller's statements. (b) It is not paid at closing. (c) It must be accounted for in the broker's statement. (d) It is always a credit.

(c) It must be accounted for in the broker's statement.

Which entry would appear as a credit on the seller's closing statement? (a) Documentary stamp tax on the deed (b) Recording the mortgage (c) Purchase price (d) Abstract continuation

(c) Purchase price

Which statement about the broker's portion of the closing statement is true? (a) All double-entry items must appear there. (b) Total receipts, minus the binder deposit, equal the grand total. (c) Receipts and disbursements must equal. (d) Total expenses, less the brokerage fee, equal the grand total.

(c) Receipts and disbursements must equal.

In the absence of any agreement between the parties, who pays the state documentary stamp tax on the deed? (a) The attorney (b) The broker (c) The seller (d) The state

(c) The seller

In a residential transaction, how is the brokerage fee reflected on the closing statement? (a) Credit to the buyer (b) Credit to the seller (c) Debit to the buyer (d) Debit to the seller

(d) Debit to the seller

Who is paid the balance due from the buyer that is shown on the closing statement? (a) The seller (b) The mortgagee (c) The broker (d) The closing agent

(d) The closing agent