Calculate the net operating income of the property

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Reference no: EM131839857

1. The net operating income for a property is $1 million. Interest expense is $100,000. Depreciation expense is $200,000. The mortgage payment is $150,000. The owner's marginal tax rate is 45%. What is the after-taxcash flow for the property?

A. 450,000

B. 535,000

C. 385,000

D. 650,000

2. The De Lapidated Arms Hotel has a gross potential rental income (at 100% occupancy) of $34,000,000 per year. Its operatingexpenses are $16,000,000 per year. The mortgage interest on the property is $13,000,000 per year and the depreciationexpense is $11,000,000 per year. Calculate the net operating income (NOI) of the property, assuming the hotel is 70% occupied

a. 10,400,000

b. 7,800,000

c. 10,400,000

d. 13,800,000

Reference no: EM131839857

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