Trust Funds
A real estate broker's operating account is used for:
AHolding client earnest money deposits
BDay-to-day business expenses such as rent, payroll, and advertising✓ Correct
CHolding security deposits from tenants
DReceiving commission income before disbursing to agents
Explanation
The broker's operating (general) account is for conducting normal business activities — paying expenses, receiving net commissions after disbursement to agents, etc. It must never contain client funds (trust money), which belong in a separate trust account.
Related Alabama Trust Funds Questions
- Under Alabama law, AREC may audit a broker's trust account:
- An Alabama broker receives rental income on behalf of a property owner. These funds must be deposited into:
- When a buyer's offer is rejected by the seller, the earnest money should be:
- A broker in Alabama may maintain a single trust account for multiple clients provided:
- Which of the following is the best description of a broker's fiduciary duty regarding trust funds?
- Alabama regulations require a broker to maintain their trust account in a financial institution located in:
- If AREC discovers that a broker has been consistently depositing personal funds into the trust account in excess of what is needed for bank fees, AREC would likely characterize this as:
- If a listing expires without a sale, earnest money that was deposited should be:
Practice More Alabama Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Alabama Quiz →