Answer:
The correct answer is ($596.93 with a year of<u> 360 days</u>) or ($588.75 with a year of <u>365 days</u>)
Explanation:
First step: Divide the annual property taxes into the number of days in a year.
$1,776 ÷ 360 days = 4.9333 (price per day, With a year of<u> 360 </u>days)
$1,776 ÷ 365 days = 4.8657 (price per day, With a year of <u>365</u> days)
Second step: Multiply the price per day by the number of days of the closing, for this case May 1
Jan= 31 days
Feb= 28 days
March= 31 days
April= 30 days
May= 30 days (but the closing is on 1 May, for this month, count just 1 day)
= 31 (Jan) + 28 (Feb) + 31 (March) + 30 (April) + 1 (May) = 121 days until May 1
Third step: Price per day x number of days until closing
$4.9333 x 121 days = $ 596.93
$4.8657 x 121 days = $ 588.75
