Bruce signs a contract of purchase and sale with Sandy to buy her home for $200,000. The completion and adjustment date is set at November 15th. It is NOT a leap year. The commission payable is 3% of the selling price. Bruce has made a deposit of $3,000 which has passed to Bruce’s lawyer to be deposited in a trust account until the completion date. Sandy agrees to accept Bruce’s SUV as part payment equal to $5,000. Bruce borrows a loan of $60,000 from RBC. Current year’s property taxes are $800, which Sandy has paid on time. For legal and registration fees, Bruce’s lawyer will charge $400. Sandy will be paying out a judgment registered against the tile to her house in the amount of $2,500 along with the legal fee of removing it, which is $120. Bruce’s lawyer to will handle this transaction for both parties. As no exemptions apply to this transaction, property transfer tax will be payable upon completion.
Bruce’s share of the year’s property taxes will appear on Sandy’s statement of adjustments as a:
- A debit of $103.01
- A debit of $100.82
- A credit of $103.01
- A credit of $100.82