"stile" and "rail" refer

11/14/2013

door

mui

11/14/2013 02:50:58 am

1. Using the economic age-life method, a graph of depreciated value of an improvement versus its age will appear as:
a straight line
a broken line
a downward sloping line
an upward sloping line

2. A house with four bedrooms and one bathroom is an example of:
physical deterioration
functional obsolescence
external obsolescence
incurable physical deterioration

3. The difference in value between the cost (new) of the improvements and their current value is called:
depreciation
appreciation
cost to cure
super adequacy

4. Which type of value loss is attributed to causes lying within the property?
Functional obsolescence
Incurable depreciation
Economic obsolescence
None of the choices

5. The age-life method of estimating accrued depreciation suggests that
The age of the building depends on its life
Annual value loss is proportional to the total life expectancy
All buildings depreciate at the same rate
Loss in value depends on market studies

6. Which method takes into account the amount of depreciation due to curable items which is considered equal to the cost of curing the defects?
Observed condition method
Cost to cure method
Capitalization method
Sales comparison method

7. Depreciation caused by design defects is called:
a superinadequacy
functional inadequacy
functional obsolescence
competency obsolescence

8. Economic or external obsolescence is generally found to be
Curable
Incurable
Less than typical
The same for all properties

9. An item of depreciation that can be easily and economically restored or replaced is considered:
short-lived
long-lived
curable
incurable

10. An expressway is built near a residential neighborhood resulting in very high traffic noise. This is an example of:
physical deterioration
functional obsolescence
external obsolescence
none of the choices

11. A unique structure under appraisal is known to have cost $70,000 in 1976. Your construction cost index indicates that today's costs are 95% higher. What is the indicated reproduction cost today?
$ 66,500
$136,500
$120,000
$ 70,000

12. Your cost manual suggests a current local base cost of $75.00 per square foot for a good quality 2,000 S.F. house under appraisal. Additives amount to $15,000. The garage is figured at $25/S.F. for 400 square feet. Assuming no other adjustments, what would the total improvement cost be?
$150,000
$175,000
$165,000
$200,000

13. The effective age of an improvement:
depends on the actual age of the improvement.
is the difference between actual age and economic life.
is the difference between actual age and remaining economic life.
is the difference between economic life and remaining economic life.

14. When a basic cost calculation is adjusted to reflect extra features or refinements, which cost method is used?
The comparative square foot method
The unit-in-place method
The index method
None of the choices

15. External or economic obsolescence is generally regarded as:
incurable.
curable.
either curable or incurable.
neither curable nor incurable.

16. As distinguished from reproduction cost, replacement cost refers to
The cost of an exact replica building
The cost of a building that will serve the same purpose as the one being appraised
The cost of reproducing the subject building
None of these choice

17. A building's square footage is determined by:
i. a licensed contractor only.
ii. multiplying length times width.
iii. first measuring the outside dimensions to break it down into rectangles and triangles.
iv. both ii and iii.
i only
ii only
iii only
iv only

18. Most cost manuals attempt to reflect cost differences for all but one of the following
Construction class and quality
Entrepreneurial profit
Size, shape, height
Cost refinements

19. Multiplying the length times the width of a building determines the:
square footage
size of the mortgage
number of rooms
none of the choices

20. Functional obsolescence could be caused by which of the following?
A worn-out roof
A poor location
Deferred maintenance
A ceiling that is too high

21. The apparent or functional age of an improvement, based on its current conditions and those of the market is called:
actual age
effective age
physical age
contract age

22. Accrued depreciation is not caused by which of the following?
physical deterioration
external obsolescence
functional obsolescence
accelerated depreciation

23. Depreciation may be measured by:
market comparison.
income capitalization.
cost to cure.
any of the above.

24. A poor floor plan design is an example of:
def

hamlet

11/14/2013 08:12:19 am

1. A residence that had been rented for $1,300 per month sells for $149,500. What is the gross monthly rent multiplier for this property?

10

94

115

194

2. When completing the Operating Income Statement, the appraiser (or lender) must obtain all of the following information from the owner EXCEPT:

actual rents being collected

a list of all the names of the tenants

the dates existing leases expire

12 months' projected rental income and expenses

3. The reciprocal of the capitalization rate is called the:

multiplier

factor

anti-capitalization rate

either "multiplier or "factor"

4. The term "residual" refers to something that is:

left over

yet to happen

discounted

a loss

5. The process of eliminating inapplicable expenses and adjusting the expenses that remain is called:

developing the capitalization rate.

reconstructing the operating statement.

finding effective gross income.

the market extraction method

6. What type of rent collected by a landlord from a tenant is based on a lease agreement?

market rent

leased fee payment

contract rent

historical rent

7. A property's equity dividend is also called:

potential gross income

effective gross income

net operating income

pre-tax cash flow

8. What term refers to the repayment of capital return of the investment?

Usury

Reinvestment

Recapture

None of the choices

9. Which of the following appraisals would require the application of the Income Approach?

i. Office buildings and apartment buildings

ii. Shopping centers and hotels

i only

ii only

iii. both i and ii

None of the choices

10. What term refers to the repayment of capital return "of" the investment?

Usury

Reinvestment

Recapture

None of the choices

11. Using an overall capitalization rate of 8%, what is the indicated value of a property with net operating income of $35,000 per year?

$280,000

$437,500

$560,000

Cannot be determined from the information given

12. Income property is compared by certain investment requisites. Which of the following refers to the ability to "trade on the equity? "

Safety

Liquidity

Yield

Leverage

13. Capitalization refers to:

converting income into value

converting expenses into value

converting original cost into current price

estimating the cost to replace an existing structure

14. A property is valued at $200,000 and has net operating income of $18,000. What is the cap rate?

0.9%

9%

18%

20%

15. Calculating separate capitalization rates for the equity investor and for the lenders is the:

band of investment method

mortgage constant method

segregation method

none of the choices

16. A residence that had been rented for $1,300 per month sells for $149,500. What is the gross monthly rent multiplier for this property?

10

94

115

194

17. Operating expenses include:

all property-related expenses necessary to produce gross income

loan or interest payments

income taxes

depreciation deductions

18. Which income capitalization technique is considered to be the simplest and most reliable?

Building residual

Direct capitalization

Land residual

Equity Residual

19. The income remaining after vacancy and credit losses are deducted from gross rent is known as

Net to operations

Net income

Effective gross income

None of these choices

20. The amount of income available to the owner after the mortgage lender has been paid its portion of the net operating income is called:

pre-tax cash flow

equity dividend

none of the choices
both "pre-tax cash flow" and "equity dividend"

hamlet cost approach

11/14/2013 08:13:11 am

21. An apartment building has a scheduled gross of $80,000 per year, vacancy of 5%, and operating expenses of $20,000. Find the indicated value if the net income is capitalized at 8%.

$ 1,000,000

$ 750,000

$ 700,000

$ 450,000

22. The formula for direct capitalization is:

Value = Income x Multiplier (or Factor)

Value = Profit x Loss

Value = Riches x Wealth

none of the choices

23. Which of the following operating expenses is not normally considered a fixed expense?

real estate taxes

property management

fire insurance

flood insurance

24. When applying the Income Approach, the ratio between the amount of income and the amount of investment is the:

rate of return

net operating income

inversion principle

none of the choices

25. The formula for operating expense ratio is: OER = operating expenses divided by:

effective gross income

net operating income

pre-tax cash flow

variable expenses

26. The reciprocal of the capitalization rate is called the:

multiplier

factor

anti-capitalization rate

either "multiplier" or "factor"

27. Capital recapture is:

return of the investment

return on the investment

the interest rate

the discount rate

28. The difference between potential gross income and effective gross income is:

operating expenses

market rent

vacancy and collection losses

variable expenses

29. An item that has a life span that is less than the expected life of the building is called:

a longlived component

a short lived component

an interim appliance

a bad investment

30. Which type of property is NOT a commercial income-producing property?

retail store

hotel

gas station

apartment complex

31. The total amount of revenue a property is capable of producing at full capacity is called:

A potential gross income (PGI)

effective gross income (EGI)

saturated cash income (SCI)

none of the choices (NOA)

32. In computing value by the income capitalization approach, which of the following is not applicable?

capitalization rate

net operating income

accrued depreciation

gross income

33. The amount of rent that could be obtained for a property on the open market if it were available is:

market rent

contract rent

scheduled rent

historic rent

34. The percentage rate used to convert the income into value is called the:

rate

CAP rate

capitalization rate

all of the choices

35. In order to be considered a "comparable sale," the sale must:

have occurred within the past 6 months

have occurred within the last year

have occurred within the last 18 months

be recent

36. Which of the following categories of expenses is not included as an operating expense?

maintenance

utilities

management fees

mortgage payments

37. Cash flow is defined as the

Net income after debt service

Effective gross income less expenses

Advantage of a favorable loan

Total gross income before any expenses or payments.

38. The expense associated with the repair of major equipment, such as a faulty elevator in a rental building, is considered a(n):

capital expense

fixed expense

maintenance and repair expense

other expense

39. The Income Approach to value is often referred to as the:

investment approach

income capitalization approach

risk-free approach

cash back approach

40. The total amount of revenue a property is capable of producing at full capacity is called:

potential gross income (PGI)

effective gross income (EGI)

saturated cash income (SCI)

none of the choices (NOA)

terms for future link

11/14/2013 08:32:32 am

pretax cash flow = equity dividened

==
COOL QUESTION
The broker will also pay the following expenses for Eric and will be reimbursed at the closing:
Attorney’s fee $150.00
Deed recording fee 6.00
Mortgage recording fee 10.00
Mortgage note stamps (tax) 45.00
Intangible tax on mortgage 60.00
Solution:
Four items must be prorated between the seller and buyer:
1.
Interest for the month of June for the existing mortgage.
2.
Hazard insurance policy for the calendar year of 2004.
3.
Rent for the month of June.
4.
Property taxes for the calendar year of 2004.
The prorations are as follows ( Note that 2004 is a leap year.):
Interest is paid in arrears, by the buyer. Thus the seller owes the buyer for the seller’s share of the bill:
Seller’s portion of interest: (7/30) x 347.08 = $80.99
Hazard insurance was prepaid by the seller for the calendar year. Thus, the buyer owes the seller for the buyer’s share of the premium:
Buyer’s portion of the hazard insurance premium: (207/366) x 550 = $311.07
Monthly rent was paid in advance to the seller. Thus, the seller owes the buyer his share of the rent:
Buyer’s portion of the monthly rent: (25/30) x 850 = $708.33
Property taxes are paid in arrears, by the buyer. So the seller owes the buyer for the seller’s portion of the payment:
Seller’s portion of the 2004 property taxes: (159/366) x 1,200 = $521.31
These prorations, together with the other information above, result in the closing statement as displayed.

"stile" and "rail" refer

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