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Humber College Exam 4: Invigilated Theory Sample Questions:

1. A salesperson has several obligations to the buyer when assisting them in the purchase of a commercial condominium unit for their own use. Which of the following is one of those obligations?

A) Ensure the buyer had the opportunity to fully inspect the financial statements of both the condominium and the seller's business
B) Confirm the buyer's intended use adheres to all municipal zoning requirements
C) Review all documentation and advise the buyer regarding the financial status of the condominium corporation, including the reserve fund
D) Advise the buyer to commission a Phase 3 Environmental Site Assessment in addition to their inspection

2. A tenant has an established business with good growth potential for the foreseeable future and wants to rent a retail property for expansion. If the landlord wants to have the opportunity to boost the rent when the tenant's sales are good, which type of lease would you recommend to the landlord?

A) Percentage lease
B) Triple net lease
C) Gross lease
D) Net lease

3. A salesperson is representing a commercial tenant client who is interested in leasing a property for their business. The salesperson and their client are inspecting a property that includes a few accessory buildings.
This is ideal for the tenant, as the accessory buildings can serve as storage for their business. The tenant asks their salesperson to find out the measurements of the accessory buildings. Why is it important for the tenant to know the total area of the accessory buildings included on the property?

A) It is important for the tenant to know the total area of the accessory buildings as it will be considered within the tenant's usable area.
B) It is important for the tenant to know the total area of the accessory buildings as they will have to share the use of them with other tenants.
C) It is important for the tenant to know the total area of the accessory buildings as it will contribute to their rentable area.
D) It is important for the tenant to know the total area of the accessory buildings as it will be deducted from their rentable area.

4. When representing a client who is selling a business, a salesperson must be aware of concerns related to compliance. Which of the following is NOT a compliance concern?

A) The seller provides insufficient due diligence documents
B) Income and expense statements contain misrepresentations
C) The seller discloses all liabilities of the business in writing
D) The condition of goods, chattels, and fixtures cannot be verified

5. A salesperson sells an office building using the Commercial Agreement of Purchase and Sale along with a schedule that lists all the fixtures, chattels, and rental items of the office building. After closing the real estate transaction, a dispute arises between the seller and the buyer about which chattels, fixtures, and rental items of the office building were to be included and which were to be excluded. Which of the following is NOT an accurate statement regarding the salesperson's actions related to negotiating chattels, fixtures, and rental items?

A) The salesperson should clearly list all rental items and service contracts, as these will not be included in the purchase price of the real property being purchased.
B) The salesperson should specifically exclude all chattels that are not a part of the transaction since chattels are considered a part of the property and are normally included in the purchase price.
C) The salesperson should specifically exclude all fixtures that are not a part of the transaction since fixtures are considered a part of the property and are normally included in the purchase price.
D) The salesperson should clearly describe and list the fixtures and chattels in the Agreement of Purchase and Sale and mark each item as an exclusion or inclusion.

Solutions: