A real estate broker, on a sale, earns a 6.5 percent commission. The listing salesperson receives 30 percent of the commission, which equals $3,575. What was the selling price of the property?

A real estate broker, on a sale, earns a 6.5 percent commission. The listing salesperson receives 30 percent of the commission, which equals $3,575. What was the selling price of the property?

• A. $183,333.33
• B. $183,000
• C. $174,000
• D. $190,000

Answer: (A)

Understanding how commissions relate to the sale price: the listing salesperson’s 30% share is $3,575, so the total commission must be $3,575 divided by 0.30, which equals $11,916.67 (exactly 11,916 2/3). That total commission is 6.5% of the selling price, so the selling price equals the total commission divided by 0.065. Doing that, 11,916.67 ÷ 0.065 = $183,333.33 (the exact value is 183,333 1/3). Therefore, the selling price is about $183,333.33.

Understanding how commissions relate to the sale price: the listing salesperson’s 30% share is $3,575, so the total commission must be $3,575 divided by 0.30, which equals $11,916.67 (exactly 11,916 2/3). That total commission is 6.5% of the selling price, so the selling price equals the total commission divided by 0.065. Doing that, 11,916.67 ÷ 0.065 = $183,333.33 (the exact value is 183,333 1/3). Therefore, the selling price is about $183,333.33.