Chapter 14 - Learning Objectives & Key Terms

Question 1

Arrears

Answer 1

The state of not being up to date in the discharge of an obligation.

Question 2

Credit

Answer 2

An entry on the credit side of an account; a payment of value received.

Question 3

Debit

Answer 3

An entry on the charge side of an account; a charge or expense.

Question 4

Level Payment Plan

Answer 4

Calculating the total cost of a service over a period of time such as a year then averaging the payments to an amount per month that will cover the total annual bill. Most often used for utility payments

Question 5

Preclosing Inspection

Answer 5

The buyer’s final walk through the empty house to check that it is in the same condition as inspection day — except that the seller has moved out.

Question 6

Principal

Answer 6

The employer of an agent, such as a buyer or seller

Question 7

Profit

Answer 7

Money that is made in a business after all the costs and expenses are paid.

Question 8

Proration

Answer 8

Adjustments of interest, taxes, and insurance, etc., on a pro rata basis as of the closing or agreed upon date.