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A comparable requires a +$14,000 GLA adjustment and a −$9,000 condition adjustment. Its net adjustment is:

Correct Answer

A) +$5,000, with gross adjustments of $23,000

Why this is correct: Net adjustment is the algebraic sum: +14,000 + (-9,000) = +5,000. Gross adjustment is the sum of the absolute values: |+14,000| + |-9,000| = 23,000. Both figures are reported to show the total adjustment activity and the net effect. Why the other choices are wrong: The net is +$5,000, not +$23,000 or -$5,000. The adjustments offset partially, but the net is not zero. Exam tip: Net adjustment = sum of all adjustments. Gross adjustment = sum of the absolute values of all adjustments.

Answer Options
A
+$5,000, with gross adjustments of $23,000
B
+$23,000, with gross adjustments of $5,000
C
−$5,000, since condition dominates size
D
$0, since the two adjustments offset

Why This Is the Correct Answer

Why this is correct: Net adjustment is the algebraic sum: +14,000 + (-9,000) = +5,000. Gross adjustment is the sum of the absolute values: |+14,000| + |-9,000| = 23,000. Both figures are reported to show the total adjustment activity and the net effect. Why the other choices are wrong: The net is +$5,000, not +$23,000 or -$5,000. The adjustments offset partially, but the net is not zero. Exam tip: Net adjustment = sum of all adjustments. Gross adjustment = sum of the absolute values of all adjustments.

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