CERTIFIED APARTMENT MANAGER EXAMS SCRIPT
QUESTIONS AND ANSWERS GRADED A+
✔✔What is a Chart of Accounts? - ✔✔A list of accounts to which revenue and expenses
are posted and show up on the General Ledger.
✔✔What is used to generate an Income Statement? - ✔✔Entries in the General Ledger
✔✔List some benefits of minimizing financial loss - ✔✔Increases the financial success
of a property
Improves property performance
Makes your job easier
✔✔What are the main types of financial loss you should work to prevent? - ✔✔Vacancy
loss
Offline and nonrevenue units
Bad Debt (delinquency and collections)
Concessions and discounts
✔✔During the rent collection process, what things should you consider before
occupancy? - ✔✔The screening process
Rent collection policy
Inclusion of the policy in the lease, orientation materials, etc.
✔✔During the rent collection process, what is the purpose of resident communication
efforts? - ✔✔To facilitate the rent collection process
✔✔Why would you want to create a buffer for rent collection? - ✔✔To help you remain
on good terms with residents
To ensure timely and complete payments
✔✔What are some characteristics of Variable Expenses? - ✔✔Vary as conditions
change
Many are associated with occupancy
✔✔What are Capital Expenses? - ✔✔Costs for large improvements that have an
economic useful life beyond one year
✔✔Describe a Cost Benefit Analysis - ✔✔Process of weighting a potential expense
against a potential benefit
✔✔What is the most important thing to keep in mind when developing a budget? -
✔✔The owners property objectives and investment goals
,✔✔What are the steps to the budget development process? - ✔✔Identify Goals
Gather Information
Assign numerical values
✔✔When would you develop a Rehab or Renovation budget? - ✔✔When a property is
being rehabbed or undergoing retrofitting/moderization
✔✔What are the three tips to developing budgets covered today? - ✔✔Be prepared.
Use historical numbers.
Seek input.
✔✔What is Extrapolation/Annualization? - ✔✔Estimating future information by
extending known information
✔✔How do you analyze variances? - ✔✔Compare budget to actual numbers.
Look at events on the property or in your submarket or region.
✔✔Are increased expenses favorable or unfavorable variances? - ✔✔Unfavorable
✔✔Once you've analyzed and can explain variances, What should you do next? -
✔✔Determine what, if any, action to take
✔✔What is the benefit to the investor resulting from an investment - ✔✔Return; the
financial benefit
✔✔What is the purpose of measuring performance? - ✔✔Shows if goals are met and
drives investment decisions
✔✔If a down payment is $200,00 and the cash flow generated is $20,000 What is the
cash on cash return? - ✔✔10%
✔✔Does a lower cap rate indicate lower or higher value? - ✔✔Higher Value
✔✔What type of property valuation approach would you use if there are several similar
properties in the area that have recently sold? - ✔✔Sales Comparison Approach
✔✔If you increase the NOI by $24,000 and the cap rate is 6%, how much value are you
adding to the property? - ✔✔$400,000
✔✔What attributes affect the value of the property? - ✔✔Supply and Demand
Highest and Best Use
External Influences
,✔✔What determines Cap Rates? - ✔✔The market and quality of the property; can be as
low as 5% and as high as 12%
✔✔What are three property assets to protect through risk management? - ✔✔Property
People
Community Goodwill
✔✔What areas should a risk management process address? - ✔✔Identify potential risks
in operations
Analyze the frequency and severity of past/potential losses
Eliminate or reduce risks
Building financial protection to cover non-eliminated risks
Create risk management policies and procedures
✔✔List three types of financial risk - ✔✔Fraud
Theft
Embezzlement
✔✔What is the most common risk management strategy? - ✔✔Finance the risk
✔✔When minimizing financial risk, what are three areas to consider? -
✔✔Income/Fees/Cash
Physical Property
Records and Screening
✔✔What are the three highest liability areas? - ✔✔Property Hazards
Environmental Hazards
Crime Deterrence
✔✔What are your responsibilities to provide habitability? - ✔✔Repair and Maintenance
to reduce safety hazards
Maintaining required housing habitability
✔✔What must all public pools and spas have? - ✔✔Anti-entrapment devices
✔✔When/how can you communicate to residents about their safety? - ✔✔During the
lease signing meeting
With notice letters when serious incidents occur
During resident meetings
In the community newsletter
✔✔List two federal environmental governing agencies - ✔✔Environmental Protection
Agency (EPA)
Occupational Safety & Health Administration (OSHA)
, ✔✔EPA - ✔✔Environmental Protection Agency
✔✔OSHA - ✔✔Occupational Safety and Health Administration
✔✔What are the six areas of focus for OSHA that employers are required to comply
with? - ✔✔Hazard Communication Standard
Lockout/Tagout Standard
Bloodborne Pathogens
Personal Protective Equipment (PPE)
Electrical Safety-Related Work-Practice
OSHA Record Keeping
✔✔The maintenance technician was using hazardous chemicals during his shift. what
should he do at the end of his shift? - ✔✔Empty and clean the container.
✔✔What is a Safety Data Sheet (SDS)? - ✔✔A document that describes the healthy
and physical hazards associated with a particular chemical or material.
✔✔What are the written requirements for the PPE Standard? - ✔✔The standard does
not require a written program, but does require a written assessment and
documentation of exposure
✔✔Why is it important for managers to be informed of the OSHA regulations and
perform regular inspections to ensure compliance? - ✔✔To comply with regulations
when an OSHA inspection is performed and help you avoid any fines or possible injury
claims
✔✔What is the goal of emergency planning? - ✔✔To minimize impact to residents, staff,
and business operations.
✔✔What are the three major impacted entities in an emergency? - ✔✔People
Property
Business
✔✔What is the purpose of an emergency drill? - ✔✔To ensure that all aspects of the
evacuation can be fully executed.
✔✔What are the components of an emergency plan? - ✔✔Prevention
Detection
Communication
Evacuation
Containment/Mitigation
Recovery
Public Relations
QUESTIONS AND ANSWERS GRADED A+
✔✔What is a Chart of Accounts? - ✔✔A list of accounts to which revenue and expenses
are posted and show up on the General Ledger.
✔✔What is used to generate an Income Statement? - ✔✔Entries in the General Ledger
✔✔List some benefits of minimizing financial loss - ✔✔Increases the financial success
of a property
Improves property performance
Makes your job easier
✔✔What are the main types of financial loss you should work to prevent? - ✔✔Vacancy
loss
Offline and nonrevenue units
Bad Debt (delinquency and collections)
Concessions and discounts
✔✔During the rent collection process, what things should you consider before
occupancy? - ✔✔The screening process
Rent collection policy
Inclusion of the policy in the lease, orientation materials, etc.
✔✔During the rent collection process, what is the purpose of resident communication
efforts? - ✔✔To facilitate the rent collection process
✔✔Why would you want to create a buffer for rent collection? - ✔✔To help you remain
on good terms with residents
To ensure timely and complete payments
✔✔What are some characteristics of Variable Expenses? - ✔✔Vary as conditions
change
Many are associated with occupancy
✔✔What are Capital Expenses? - ✔✔Costs for large improvements that have an
economic useful life beyond one year
✔✔Describe a Cost Benefit Analysis - ✔✔Process of weighting a potential expense
against a potential benefit
✔✔What is the most important thing to keep in mind when developing a budget? -
✔✔The owners property objectives and investment goals
,✔✔What are the steps to the budget development process? - ✔✔Identify Goals
Gather Information
Assign numerical values
✔✔When would you develop a Rehab or Renovation budget? - ✔✔When a property is
being rehabbed or undergoing retrofitting/moderization
✔✔What are the three tips to developing budgets covered today? - ✔✔Be prepared.
Use historical numbers.
Seek input.
✔✔What is Extrapolation/Annualization? - ✔✔Estimating future information by
extending known information
✔✔How do you analyze variances? - ✔✔Compare budget to actual numbers.
Look at events on the property or in your submarket or region.
✔✔Are increased expenses favorable or unfavorable variances? - ✔✔Unfavorable
✔✔Once you've analyzed and can explain variances, What should you do next? -
✔✔Determine what, if any, action to take
✔✔What is the benefit to the investor resulting from an investment - ✔✔Return; the
financial benefit
✔✔What is the purpose of measuring performance? - ✔✔Shows if goals are met and
drives investment decisions
✔✔If a down payment is $200,00 and the cash flow generated is $20,000 What is the
cash on cash return? - ✔✔10%
✔✔Does a lower cap rate indicate lower or higher value? - ✔✔Higher Value
✔✔What type of property valuation approach would you use if there are several similar
properties in the area that have recently sold? - ✔✔Sales Comparison Approach
✔✔If you increase the NOI by $24,000 and the cap rate is 6%, how much value are you
adding to the property? - ✔✔$400,000
✔✔What attributes affect the value of the property? - ✔✔Supply and Demand
Highest and Best Use
External Influences
,✔✔What determines Cap Rates? - ✔✔The market and quality of the property; can be as
low as 5% and as high as 12%
✔✔What are three property assets to protect through risk management? - ✔✔Property
People
Community Goodwill
✔✔What areas should a risk management process address? - ✔✔Identify potential risks
in operations
Analyze the frequency and severity of past/potential losses
Eliminate or reduce risks
Building financial protection to cover non-eliminated risks
Create risk management policies and procedures
✔✔List three types of financial risk - ✔✔Fraud
Theft
Embezzlement
✔✔What is the most common risk management strategy? - ✔✔Finance the risk
✔✔When minimizing financial risk, what are three areas to consider? -
✔✔Income/Fees/Cash
Physical Property
Records and Screening
✔✔What are the three highest liability areas? - ✔✔Property Hazards
Environmental Hazards
Crime Deterrence
✔✔What are your responsibilities to provide habitability? - ✔✔Repair and Maintenance
to reduce safety hazards
Maintaining required housing habitability
✔✔What must all public pools and spas have? - ✔✔Anti-entrapment devices
✔✔When/how can you communicate to residents about their safety? - ✔✔During the
lease signing meeting
With notice letters when serious incidents occur
During resident meetings
In the community newsletter
✔✔List two federal environmental governing agencies - ✔✔Environmental Protection
Agency (EPA)
Occupational Safety & Health Administration (OSHA)
, ✔✔EPA - ✔✔Environmental Protection Agency
✔✔OSHA - ✔✔Occupational Safety and Health Administration
✔✔What are the six areas of focus for OSHA that employers are required to comply
with? - ✔✔Hazard Communication Standard
Lockout/Tagout Standard
Bloodborne Pathogens
Personal Protective Equipment (PPE)
Electrical Safety-Related Work-Practice
OSHA Record Keeping
✔✔The maintenance technician was using hazardous chemicals during his shift. what
should he do at the end of his shift? - ✔✔Empty and clean the container.
✔✔What is a Safety Data Sheet (SDS)? - ✔✔A document that describes the healthy
and physical hazards associated with a particular chemical or material.
✔✔What are the written requirements for the PPE Standard? - ✔✔The standard does
not require a written program, but does require a written assessment and
documentation of exposure
✔✔Why is it important for managers to be informed of the OSHA regulations and
perform regular inspections to ensure compliance? - ✔✔To comply with regulations
when an OSHA inspection is performed and help you avoid any fines or possible injury
claims
✔✔What is the goal of emergency planning? - ✔✔To minimize impact to residents, staff,
and business operations.
✔✔What are the three major impacted entities in an emergency? - ✔✔People
Property
Business
✔✔What is the purpose of an emergency drill? - ✔✔To ensure that all aspects of the
evacuation can be fully executed.
✔✔What are the components of an emergency plan? - ✔✔Prevention
Detection
Communication
Evacuation
Containment/Mitigation
Recovery
Public Relations
