A property closes on March 15th. The annual property taxes of $2,400 have been paid by the seller for the entire year. Using a 365-day year and the day of closing belongs to the buyer, what is the proration amount the buyer owes the seller?
Correct Answer
B) $1,806.58
Correct: Days seller owned (Jan 1 - Mar 14) = 73 days. Daily rate = $2,400 ÷ 365 = $6.575. Buyer owes seller for remaining days (365 - 73 = 292 days): 292 × $6.575 = $1,806.58. Why not A: This doesn't account for the exact daily calculation. Why not C: This calculates what the seller used, not what buyer owes. Why not D: This is an approximation not using exact daily rates.
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