Solution-Compute the estimated property value

Compute the estimated property value

Assignment Help Accounting Basics

Reference no: EM132835168

Consider the following property:

1,000 Square foot; SAR 50 per square foot new.

Depreciation rate equals 10%.

Land value is estimated at SAR 15,000.

Gross Rent Multiplier (GRM) = 4, derived from the market.

Subject potential gross income (P G I) is SAR 150,000 per year.

Problem 1: Calculate the property value estimate with the cost approach.

Problem 2: Calculate property value estimate with the income approach.

Problem 3: A property produces a first-year net operating income of SAR 24,000. Because of the long economic life of the building, the income is considered as a perpetuity that will grow by 2.5% per year. Using a discount rate of 9.5%, compute the estimated property value.

Reference no: EM132835168

Questions Cloud

Discuss some of the protected characteristics covered : Discuss some of the protected characteristics covered by equal employment opportunity laws and why they are important in today's employment setting

Briefly discuss the potential use case of application : What internet company are you using? and What is the brand and the model of your router and discuss the potential use case of application

Define firewall security techniques : Define a firewall. Define firewall security techniques. Write the strengths and weaknesses of the Microsoft Windows firewall

Explain the advantages as a borrower of lending institution : Explain the advantages as a borrower or from the perspective of the lending institution. which organization type is it easiest or most difficult to raise money?

Compute the estimated property value : The income is considered as a perpetuity that will grow by 2.5% per year. Using a discount rate of 9.5%, compute the estimated property value.

How much could he withdraw at the beginning of each month : How much could he withdraw at the beginning of each month for the next 30 years and end up with zero in the account

About entrepreneurship in global economy : You have read about entrepreneurship in a global economy. Research other company's strategy for going global.

What is the annual net operating income : Office expenses are SAR 7.50 per square foot and an expense stop is set at SAR 6.50 per square foot. What is the annual net operating income?

How the covid-19 pandemic has affected teens : How the covid-19 pandemic has affected teens and their social skills development, and cognitive development? Approach the issue using a bio-psycho-social.

User Account

All Pages

Compute the estimated property value

Reference no: EM132835168

Reference no: EM132835168

Questions Cloud

Reviews

Write a Review

Accounting Basics Questions & Answers

Prepare journal entries for the payment of interest on june

Find average price per share for which common stock issued

Outline a defense for your audit firm to any legal action

What effect will this change have on the overall profits

The chief executive of a clothes manufacturer charged with

What is the amount of the purchase discount recorded

Installment-sales-default and repossession

Record the journal entry for estimating Bad Debts

Why are so many problems in the financial community

Rocky mountain manufacturing produces a single product the

Prepare journal entry for Bramble to adjust deferred tax

What is the standard deviation for each asset return

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT