Reference no: EM133060719
Question - You are considering the purchase of a small apartment complex. The purchase price, including acquisition costs, is $1 million.
Gross potential income in the first year is estimated at $175,000 and vacancy and collection losses are estimated to be 12 percent of gross potential income.
Operating expenses and capital expenditures are expected to be $36,000 and $2,000, respectively, in year 1.
The investor will obtain a $700,000 loan at 8 percent annual interest with annual payments for 25 years.
Additional upfront financing expenses will equal $25,000.
Assume that 25 percent of the purchase price is payment for land and that the building will be depreciated over 27½ years using straight-line depreciation. There is no personal property.
Your ordinary and capital gain tax rates are 35 and 15 percent, respectively.
Calculate the mortgage payment, the interest deduction, the depreciation deduction, and the amortized financing costs for the first year of operations.
What will be your net equity investment at "time zero"?
Estimate the after-tax cash flow for the first year of operations.
Prepare income statement according to the variable costing
: The fixed selling and administrative expenses were $5,330, prepare an income statement according to the variable costing concept
|
Legitimate global police authority-negotiation facilitator
: What are the chief limits of its ability to act as a legitimate global police authority or negotiation facilitator?
|
Philosophies-approaches to housing
: What are some of the philosophies/approaches to housing in other countries that differ from the U.S.?
|
What will be the net unamortized balance
: Equipment, Trademarks, and Bonds Payable each had an amortizable life of ten (10) years. What will be the net unamortized balance
|
Calculate the mortgage payment and the interest deduction
: Calculate the mortgage payment, the interest deduction, the depreciation deduction, and the amortized financing costs for the first year of operations
|
Self-assessment on the ict professional knowledge
: Perform a self-assessment on the ICT Professional Knowledge you possess now - Which subjects/activities/assessments helped you to improve your knowledge in each
|
Ethical doctrine is automatic zero
: Cite a contemporary moral issue in our society. Not applying the ethical doctrine is an automatic zero.
|
What are the requirements you have already satisfied
: Review the selection criteria or requirement, what are the requirements you have already satisfied and what you have not? Make a specific plan to meet
|
Prepare a purchases budget for April
: In 2021, the company projects selling 100 000 of Aura lights in April, 120 000 in May, Prepare a purchases budget for April
|