What is first year debt coverage ratio

Assignment Help Financial Management

Reference no: EM131506743

You are an employee of University Consultants, Ltd., and have been given thefollowing assignment. You are to present an investment analysis of a new smallresidential income producing property for sale to a potential investor. The asking price forthe property is $1,250,000; rents are estimated at $200,000 during the first year and areexpected to grow at 3 percent per year thereafter. Vacancies and collection losses areexpected to be 10 percent of rents. Operating expenses will be 35 percent of effectivegross income. A 70 percent loan can be obtained at 11 percent interest for 30 years. Theproperty is expected to appreciate in value at 3 percent per year and is expected to beowned for five years and then sold.

What is the first year debt coverage ratio?

Reference no: EM131506743

Questions Cloud

Can pressure from family and friend also positive motivation : How would one avoid pressure from family and friends to behave in way that they had outlined? Can pressure from family and friends also positive motivation

Explain to mr skaros why his production cost report showed : Prepare a maximum 700-word informal memo and explain to Mr. Skaros why his production cost report showed only 2,000 equivalent units in ending inventory.

Elements of a history of present illness : 1. List the typical elements of a history of present illness. 2. List at least three drawbacks of handwritten patient charts.

Did you make a sound economical decision : The cost of first-class postage has risen by about 5% per year over the past 30 years. The U.S. Postal Service introduced a one-time forever stamp in 2008.

What is first year debt coverage ratio : You are an employee of University Consultants, Ltd., and have been given thefollowing assignment. What is the first year debt coverage ratio?

Find the simple payback period : Refer to Problem. If the government expects inflation to average 3% per year, what is the equivalent uniform annual savings in fuel.

A crisis for the catholic church : The Protestant Reformation, which began in 1517, did significant damage to the power and influence of the Catholic Church. Prior to the Protestant Reformation.

What is the controversy : The purpose of the research proposal is to help you to understand your project, to gain direction and feedback on your project

Before-tax internal rate of return on equiity invested : What is the investor's expected before-tax internal rate of return on equiity invested (BTIRR)

User Account

All Pages