Steven Appraisals is appraising a commercial office building for refinancing. The company is using the expected future revenue method of determining the value of the building today. Assume the building is fully leased and expected to remain that way. Annual rental revenue is $209000 per year. The expected life of the building is 20 years. Assuming an annual return of 13%, what is the current value of the office building? a. $1468173 b. $1350637 c. $4180000 d. $1541499
Steven Appraisals is appraising a commercial office building for refinancing. The company is using the expected future revenue method of determining the value of the building today. Assume the building is fully leased and expected to remain that way. Annual rental revenue is $209000 per year. The expected life of the building is 20 years. Assuming an annual return of 13%, what is the current value of the office building? a. $1468173 b. $1350637 c. $4180000 d. $1541499
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Steven Appraisals is appraising a commercial office building for refinancing. The company is using the expected future revenue method of determining the value of the building today. Assume the building is fully leased and expected to remain that way. Annual rental revenue is $209000 per year. The expected life of the building is 20 years. Assuming an annual return of 13%, what is the current value of the office building?
a. $1468173
b. $1350637
c. $4180000
d. $1541499
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