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Tresset [83]
4 years ago
10

Waldo is buying Marianne's house. The closing date (day belongs to seller) of the sale transaction is September 1 (day 244 of th

e year). Current Year real estate taxes are $1,100 (will be billed to buyer next year). Use the 365-day method for prorating. What is Marianne's share of the real estate taxes
Business
1 answer:
Alex Ar [27]4 years ago
5 0

Answer: $735.34

Explanation:

Current year tax = $1,100

Using the 365-days method of prorating,

Daily tax for the current year = $1,100 ÷ 365 = $3.0137

Since closing date of the sale transaction is September 1 of the current year, Marianne's share of the real estate tax will be from January 1st - August 31st of the present year, which equals 244 days

Therefore, Marianne's share of the real estate tax = $3.0137 × 244 = $735.34

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