PREX-1060A Exam 4: Invigilated Theory Exam Question and Answers

Ensuring inspections are being carried out as required

Contacting contractors for quotes for repairing or replacing equipment

Reviewing whether the technical components have been recently replaced or upgraded

Learning what types of equipment are in the building and having a general understanding of theirage and condition

The cost approach is preferred for newer construction properties, as the appraiser would not need to make a subjective estimation of the accrued depreciation of the building.

The cost approach is typically used to appraise income-generating properties.

The cost approach is preferred for older construction properties, as calculating depreciation on them is fairly straightforward.

The cost approach is useful for the appraisal of property types for which sales and income data are scarce, such as industrial and special-purpose properties.

Amount of advertising and publicity

Proximity to museums and historical sites

Price trend for detached homes in nearby neighborhoods

Access to raw materials used in the region

Net lease

Percentage lease

Gross lease

Triple net lease

The types of buildings that are permitted in a location, their height, and how they may be used

Lot dimensions and parking requirements

The amount of rent a building may generate

Where buildings and other structures may be located

Serving separate waivers

Serving one waiver

Serving separate notices of fulfillment

Serving one notice of fulfillment

Specifies the terms of a business partnership agreement.

Regulates matters involving ownership of a business.

Regulates trade names.

Protects the rights of workers of a business that is being sold.

The buyer can use the same amendment to ask for a change of the closing date.

The buyer can still waive the condition before the expiry date if the seller refuses to sign the amendment, provided there is a waiver provision in the condition.

The salesperson should prepare the amendment with midnight, May 17 as the irrevocable time.

To play it safe, the salesperson should amend the condition with May 18 as the expiry date.

The agreement may contain a clause forfeiting all of the deposit if the landlord has started work on the premises.

The parties may need to obtain a court order that clarifies how the deposit will be returned and distributed.

The tenant can have the deposit back without signing a mutual release as it is not their fault.

The landlord and tenant may agree to split the deposit.

The farm is sold to a corporation and the HST is included in the selling price.

The farm has been used for personal use.

The farmer uses a smaller portion of the farm for a residence.

The farmer sells the farm to a relative.

A key consideration a salesperson must keep in mind when handling the sale of a business is operating licenses.

Depending on the business location, there are various municipal bylaws, zoning, permits, and other rules and regulations that could impact the sale of a business.

There are various municipal bylaws that could impact the sale of a business, depending on the business activity.

If a municipal license is associated with the business and it may be transferrable to the buyer, then it is of no concern to the sales representative.

Goodwill

Fixed equipment

Residence

Barns and sheds

The landlord must address their tenants' issues in a timely manner in general but more so when the issue can result in serious and costly consequences.

All commercial leases require that tenants keep everything in and about the property, including all points of entry and exit, in good repair at all times.

Tenants are obligated to ensure they have adequate tenant insurance for their property.

Not all commercial leases require the landlord to perform repairs and maintenance.

Energy efficiency

Innovative elements

Sustainability

Vacancy rate

A description of the premises

The names of all the tenant's suppliers

The commencement date of the lease

The names of all parties to the lease

Operating cash flow can be positive or negative.

Operating cash flow is used when determining yield on an investment property, while sales proceeds cash flow is not used for this purpose.

Sales proceeds cash flow does not affect investor decisions.

Sales proceeds cash flow is used when determining yield on an investment property, while operating cash flow is not used for this purpose.

Bay depth is an important consideration when determining the layout of an industrial process.

Loading docks are only used to off-load products or raw materials.

Flat roofs are designed to be flat to hold water.

Floor load refers to the weight of the building during construction.

Include the current tax assessment as a schedule of the agreement.

Ensure the offer contains a clause requiring the seller and the buyer to share the property taxes to be assessed for the next three years.

Ensure the offer contains a clause allowing for compensation for adjustments to the property taxes.

Get a letter from the seller to guarantee a maximum amount of realty tax payment in the coming year.

Use a laser measuring device to take the measurements.

Recommend the services of third-party professionals to measure it.

Tell the seller the usable size is 80 percent of the rentable size.

Add a disclaimer to protect the seller from any discrepancy.

Pre-cast panels cost much more than tilt-up panels.

Both tilt-up panels and pre-cast panels can lower construction costs.

Pre-cast panels are more durable than tilt-up panels.

Both tilt-up panels and pre-cast panels are formed off-site.

Ensuring inspections are being carried out as required.

Contacting contractors for quotes for repairing or replacing equipment.

Reviewing whether the technical components have been recently replaced or upgraded.

Learning what types of equipment are in the building and having a general understanding of their age and condition.

The salesperson should tell their client that higher management fees charged for a building always indicates that the tenant is getting superior service and value.

The salesperson should explain that a tenant occupying a smaller rentable area in a building pays higher management fees per square foot compared to a tenant with an average or larger rentable area.

The salesperson should identify the reasons for high management fees charged for a building and determine the relative value it provides.

The salesperson should tell the tenant that the Condominium Authority of Ontario regulates management fees charged by buildings as per their size.

The general partner of the company must sign and date below the printed name of the limited company.

The buyer must sign and date below the printed name of the corporation.

An authorized signing officer of the company must sign and date over the words: "I haveauthority to bind the corporation" and below the printed registered name.

A major shareholder of the company must sign and date over their printed name.

The date of the agreement of purchase and sale

The balance due clause

The irrevocability clause

The purchase price

Use the R/U factor to calculate the figures

Use a laser measuring tool to take the measurements and use the R/U factor to calculate the figures

Recommend that the landlord obtain the professional services of a measuring company to obtain the figures

Use a laser measuring tool to take the measurements

Economic development offices can provide you with real property information regarding tax assessments and how to appeal your real estate taxes.

Economic development offices provide background information on local, provincial, and federal research and development incentives.

Economic development offices have important resources for those seeking suitable commercial sites for business operations.

Economic development offices can help guide development applications through municipal processes and streamline the approvals process for companies unfamiliar with regulatory requirements.

They are a good size for modern 18-hole golf courses.

They can be used for newly planned subdivisions.

They are normally less expensive than pieces of land smaller than two acres in the same neighborhood.

The developer cannot find a building lot to build a detached home.

All new commercial properties must undergo an ESA before construction begins.

An ESA is not required if the buyer is purchasing the industrial property for their own use.

No stipulations exist for the third and final phase of an ESA due to its vast and complex nature.

The Environmental Protection Act establishes the procedures and requirements for the first two phases of an ESA.

Is there any easement on the property?

Is the ownership of the building a corporation or a partnership?

What is the construction cost of the building?

Is inventory included in the sale of this business?

Liens and encumbrances that are registered against the property

The property's use doesn't comply with municipal zoning bylaws

A registered right of way that blocks the buyer's intended use of the property

The seller is not entitled to transfer title to the property for some reason

The retail tenant's rentable area would be 3,482 sq. ft.

The retail tenant's rentable area would be 3,073 sq.ft.

The retail tenant's rentable area would be 3,912 sq.ft.

The retail tenant's rentable area would be 3,605 sq. ft.

If the information on the building's utilities is not available, the salesperson can determine it by finding out the specifications of the utilities of the neighbors.

If the information on the subject building’s utilities is available, then a potential buyer will not put a condition in the offer.

The salesperson should conduct a visual inspection of the building to determine the specifications of the utilities.

The seller may have up-to-date documentation about the utilities but, in some situations, a third-party professional assessment is still needed.

A stable internet connection

Sufficient lighting

A high voltage and ampere supply

A proper ventilation system