Prepaid rent $600 received Sept 1; closing Sept 17 (seller responsible for closing day). Buyer credit:

Rationale

Buyer credit for prepaid rent is $260.

The buyer is entitled to a credit for the portion of the prepaid rent that corresponds to the days they will occupy the property after closing. Since the seller is responsible for the closing day, the calculation will account for the days from September 18 to the end of the month.

A ($340) YOUR ANSWER

This amount incorrectly assumes that the buyer is credited for more days than they occupy the property. The prepaid rent needs to be allocated only for the days after the closing date, which is not supported by the calculations.

B ($320) YOUR ANSWER

This choice also overestimates the credit by calculating the rent for too many days. The buyer's credit should reflect only the days they will actually use the property post-closing, which is less than the amount indicated here.

C ($280) YOUR ANSWER

This option miscalculates the number of days available to the buyer after closing. The credit should be based on the days from September 18 to September 30, leading to a total that is lower than $280.

D ($260) CORRECT

This choice accurately reflects the rent allocated to the buyer for the 13 days they occupy the property after closing. The total rent of $600 covers 30 days, so the daily rent is $20 ($600 ÷ 30 days). The buyer is credited for 13 days, which equals $260 ($20 × 13 days).

Conclusion

In real estate transactions, accurately calculating buyer credits for prepaid items like rent is essential. The buyer's credit of $260 correctly accounts for the days they will occupy the property after the closing date, ensuring they are fairly compensated for the prepaid rent. Understanding these calculations is crucial for all parties involved to ensure a smooth and equitable transaction.

Prepaid rent $600 received Sept 1; closing Sept 17 (seller responsible for closing day). Buyer credit:

Buyer credit for prepaid rent is $260.

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