Martina is purchasing a home in Winnipeg.The closing date is October 1.Each year's real property taxes are payable in June for taxes owed up to December 31.The amount of the taxes paid by the vendor for the entire year is $2400.In the circumstances of this transaction,which of the following is a valid statement with respect to an adjustment on taxes?

Question

Quizplus · Accepted Answer

The vendor has paid the full year's taxes, but the purchaser will own the property from October 1 to December 31. Therefore, the purchaser owes the vendor for the taxes covering October, November, and December, which is 3 months. The annual tax is $2400, so the monthly tax is $200. For 3 months, the purchaser owes $600 to the vendor.

Martina Is Purchasing a Home in Winnipeg