Owner Armstrong gave Broker Weeks an exclusive authorization to sell Armstrong's ranch. As part of the agreement, Broker Weeks agreed to advertise the ranch in a catalog that Weeks publishes and distributes to other real estate brokers. For this added service, Armstrong paid Broker Weeks $1,000 for this advertising service at the time Owner Armstrong signed the listing. Under current real estate law, this payment:
A: Must be deposited into a trust account under an agreement which may provide for forfeiture by Owner Armstrong if the owner breaches the listing agreement;
B: May be cashed or deposited by Broker Weeks, but records must reflect disposition of such funds;
C: Must be retained by Broker Weeks in a trust fund account so that it may be refunded to Owner Armstrong if the property is not sold by the broker during the listing term;
D: Must be deposited into a trust account and disbursed only to pay advertising expenditures incurred by Broker Weeks in advertising the ranch property.
Answer: D: Must be deposited into a trust account and disbursed only to pay advertising expenditures incurred by Broker Weeks in advertising the ranch property.
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