Iowa Real Estate Practice Exam

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Study for the Iowa Real Estate Test. Study with flashcards and multiple choice questions, each question has hints and explanations. Get ready for your exam!

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Which ledger notifies a broker when requested disbursements exceed the available balance?

General ledger
Individual ledger
Trust ledger
Transaction ledger

The correct answer is: Individual ledger

The individual ledger is designed to track the financial transactions pertaining to a specific client or account. It maintains a record of all funds received and disbursed, allowing the broker to monitor each client's balance closely. When disbursement requests exceed the available funds in that individual account, the ledger alerts the broker to this imbalance, ensuring that adequate funds are maintained in trust accounts. This functionality is crucial for maintaining compliance with regulations governing trust accounts, especially in the real estate industry, where mishandling client funds can lead to severe penalties. The individual ledger serves as a protective measure, helping brokers manage their clients' finances responsibly, ensuring that no funds are overdrawn against available balances, and avoiding potential legal issues.