Homework Help is Here – Start Your Trial Now!
Business
Accounting
What is POTENTIAL RENTAL INCOME in year one?

What is POTENTIAL RENTAL INCOME in year one?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question
100%

What is POTENTIAL RENTAL INCOME in year one?

Your client is interested in purchasing for all cash, Garden Park Apartments, a 100-unit apartment complex in Milford, CT. There are 50 one-bedroom units and 50 two-bedroom units. 47 one- bedroom units are currently rented at $1,500 per month and 45 two-bedroom units at $2,100 per month. Market rent for one -bedroom units is $1,700 per month and two-bedrooms rents are $2,500 per month. All rents are plus utilities. Market vacancy rate is about 4.5%. The property generates laundry income of $20.per month per occupied unit. Operating Expenses are: RE Taxes $2,500 per unit per year, personal property tax is a total of $3,100 per year. Property insurance is $145.00 per unit. Property Management is 5% of Gross operating income. Payroll is $50,000 per year; Expense benefits are $12,000 and payroll taxes are 30% of payroll. Repairs and Maintenance is $175 per unit per year. Water is $1,200 quarterly, sewer tax is $800 semi-annually, common area electric is $750 per month, Common area Gas Heat is $560 per month October to April and $150 May to September. Legal fees and accounting run about $5,500 per year The elevator permit is $450. Advertising runs about $3,100 per year. Supplies run about $50 per unit per year. Snow removal averages about $20,000 per year, Ground care runs about $75,000 per year. Elevator Contract is $2,500 per quarter. What is the NOI in year one and year of sale? Do APOD, NO Cash flow Analysis form or Cash Sale Work sheet
Transcribed Image Text:Your client is interested in purchasing for all cash, Garden Park Apartments, a 100-unit apartment complex in Milford, CT. There are 50 one-bedroom units and 50 two-bedroom units. 47 one- bedroom units are currently rented at $1,500 per month and 45 two-bedroom units at $2,100 per month. Market rent for one -bedroom units is $1,700 per month and two-bedrooms rents are $2,500 per month. All rents are plus utilities. Market vacancy rate is about 4.5%. The property generates laundry income of $20.per month per occupied unit. Operating Expenses are: RE Taxes $2,500 per unit per year, personal property tax is a total of $3,100 per year. Property insurance is $145.00 per unit. Property Management is 5% of Gross operating income. Payroll is $50,000 per year; Expense benefits are $12,000 and payroll taxes are 30% of payroll. Repairs and Maintenance is $175 per unit per year. Water is $1,200 quarterly, sewer tax is $800 semi-annually, common area electric is $750 per month, Common area Gas Heat is $560 per month October to April and $150 May to September. Legal fees and accounting run about $5,500 per year The elevator permit is $450. Advertising runs about $3,100 per year. Supplies run about $50 per unit per year. Snow removal averages about $20,000 per year, Ground care runs about $75,000 per year. Elevator Contract is $2,500 per quarter. What is the NOI in year one and year of sale? Do APOD, NO Cash flow Analysis form or Cash Sale Work sheet
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps with 2 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS