Trust Funds
A broker receives a commission payment directly from the seller at closing. This money should be deposited into:
AThe broker's trust account
BThe broker's general business operating account✓ Correct
CAn escrow account pending final distribution
DThe DRE recovery fund
Explanation
Earned commissions are broker income, not trust funds. Once a commission is earned and paid, it should be deposited into the broker's general operating or business account — placing it in the trust account would constitute commingling.
Related California Trust Funds Questions
- Which of the following is considered a trust fund under California law?
- Which of the following is TRUE about salesperson trust fund accounts?
- A broker's trust fund account must be maintained at:
- A broker places a client's $50,000 earnest money deposit into a money market account earning interest. The broker does NOT inform the client or credit the interest to the client. This is:
- What is 'conversion' in the context of trust funds?
- A broker is required to maintain a columnar record (trust fund ledger) for the trust account. The purpose of this record is to:
- A real estate broker's trust account must be maintained at:
- A salesperson receives an earnest money check from a buyer. What must the salesperson do with the check?
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