South Dakota Real Estate Exam Math: Commission, Proration & Cap Rate

Math questions appear throughout South Dakota's 120-question exam. Note: no transfer tax math for SD.

Commission **Example**: Property sells for $320,000. Commission 5%, split 50/50. Agent earns 55% of listing side. - Total: $320,000 x 0.05 = $16,000; Listing: $8,000 - Agent: $8,000 x 0.55 = **$4,400**

Net to Seller **Example**: Seller wants $260,000 net after 5.5% commission. - Sale Price = $260,000 / 0.945 = **$275,132.28**

Proration (360-day year) **Example**: Taxes $2,520. Closing October 31. - Daily: $2,520 / 360 = $7/day; Seller's days (Jan–Oct): 300 - Seller's credit to buyer: 300 x $7 = **$2,100**

Cap Rate **Example**: Rental in Sioux Falls generates $21,000 NOI. Cap rate 7%. - Value = $21,000 / 0.07 = **$300,000**

LTV **Example**: $275,000 home, $27,500 down (10%). - Loan: $247,500; LTV: $247,500 / $275,000 = **90%** — PMI required

[Practice South Dakota math at CARealestate.com/states/south-dakota](https://carealestate.com/states/south-dakota)