Calculate Net Operating Income for a rental property
Not what you're looking for?
Calculate the net operating income, given the following information:
Potential gross income: $295,000
Capitalization rate: 9%
Vacancy and collection losses: 8%
Selling expenses: 5 %
Sale price: $1,250,000
Purchase this Solution
Solution Summary
The solution first discusses and explains the definition and process for the calculation net operating income for a rental property. The information is sourced. The formulas are listed and then applied to this problem to calculate net operating income (NOI). The capitalization rate (cap rate) formula is applied also.
Solution Preview
See attached file for easier reading.
Net Operating Income or NOI is equal to a property's yearly gross income less operating expenses. Gross income includes both rental income and other income such as parking fees, laundry and vending receipts, etc. All income associated with a property. Operating expenses are costs incurred during the operation and maintenance of a property. They include repairs and maintenance, insurance, management ...
Purchase this Solution
Free BrainMass Quizzes
Basics of corporate finance
These questions will test you on your knowledge of finance.
Accounting: Statement of Cash flows
This quiz tests your knowledge of the components of the statements of cash flows and the methods used to determine cash flows.
Writing Business Plans
This quiz will test your understanding of how to write good business plans, the usual components of a good plan, purposes, terms, and writing style tips.
Production and cost theory
Understanding production and cost phenomena will permit firms to make wise decisions concerning output volume.
Paradigms and Frameworks of Management Research
This quiz evaluates your understanding of the paradigm-based and epistimological frameworks of research. It is intended for advanced students.