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gogolik [260]
3 years ago
7

Suppose you are considering the purchase of an apartment building that has 12 units that can be rented out at $1,050 per month.

You have estimated operating expenses and expected vacancy and collection losses for the first year to be $35,700 and $30,240, respectively. You also have estimated that you will be able to generate an additional $3,840 in the first year from garage rentals on the property. If the expected purchase price of the property is $1,100,000 and you are planning on making a 10% down payment. Calculate the debt yield ratio.a. 8.10%b. 8.61%c. 9.00%d. 12.05%
Business
2 answers:
ivanzaharov [21]3 years ago
8 0

Answer:

The correct answer is c. 9.00%

good luck

sergij07 [2.7K]3 years ago
6 0

Answer:

c. 9.00%

Explanation:

The formula to compute the debt yield ratio is presented below:

Debt yield ratio = Net operating income ÷ debt amount

where,

Net operating income would be

= Rent- Operating expenses - Expected vacancy and collection losses + Garage rentals on the property

= $151,200 - $35,700 - $30,240 + $3,840

= $89,100

And, the debt amount would be

= Expected purchase price × (1 - Down payment rate)

= $1,100,000 × (1 - 10%)

= $990,000

So, the ratio would be

= $89,100 ÷  $990,000

= 9%

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Len [333]

Answer:

C) 2.57%

Explanation:

Pet World's net cash flows:

<u>Year  </u>                  <u>Cash flow</u>

0                           -$9,500  

1                             $2,000

2                            $2,025

3                            $2,050

4                            $2,075

5                            $2,100

In order to find the rate of return we can use an excel spreadsheet and the IRR function =IRR (values,[guess]) =IRR (-9500,2000,2025,2050,2075,2100)

=IRR = 2.57%

3 0
3 years ago
A customer sells short 100 shares of ABC at $35 and buys 1 ABC Jul 35 Call @ $3. The stock falls to $30 and the customer closes
LUCKY_DIMON [66]

Answer:

The answer is $300 gain.

Explanation:

Operations:

  • Short 100 shares of ABC at $35 each= 100 * 35 = + $3,500
  • Buy 1 ABC Jul 35 Call @ $3 (one call equals to 100 shares)= 100 * (3) = $(300), accumulated = + 3,500 - 300 = + 3,200
  • Closes the option contract at $1 = 100 * 1 = + $100, accumulated = + 3,200 + 100 = + 3,300
  • Buys the stock at the current market price (buys 100 stock @ $30 each)= 100 * (30) = $(3,000), accumulated = + 3,300 - 3,000 = + $300.
5 0
3 years ago
How can cybercriminals harm a person whose personal information they have stolen?
Leokris [45]
When a person obtains someone else's personal information, these are some thing that could potentially happen that would harm the person whose identity has been stolen: Open new lines of credit (can harm your credit and incur debt). Seek medical attention (could be harmful by getting incorrect medical information on your record, or incurring debt). Drain savings and retirement accounts Provide an alias when arrested (harmful if the cops look for you when the other person runs, or if the other person uses your information to pay bail. Get a job and file false tax returns (could be harmful when the IRS sees the records and <span>thinks that you are not paying taxes on all of your income).</span>
3 0
3 years ago
An electronic firm invested $60,000 in a precision inspection device. It cost $4000 to operate and maintain in the first year an
Anon25 [30]

Answer:

$9,287.63

Explanation:

Data provided in the question:

Amount invested = $60,000

Operating cost for the first year = $4000

Operating and maintaining cost after 1 year = $3,000

Selling price  = $60,000

Now,

Amount paid extra in the year 1 =  $4,000 - $3,000

= $1,000

EUAC ($)

= $60,000 × A/P(10%, 4) + $3,000 + $1,000 × P/F(10%, 1) × A/P(10%, 4) - [ $60,000 × P/F(10%, 4) × A/P(10%, 4) ]

= [ $60,000 × 0.3155 + 3,000 + 1,000 × 0.9091 × 0.3155 ] - [ 60,000 × 0.6830 × 0.3155  ]

= [ $18,930 + $3,000 + $286.82 ] - [ $12,929.19 ]

= $9,287.63

5 0
3 years ago
Dolan Company's accounting records reflect the following inventories: Dec. 31, 2017 Dec. 31, 2016Raw materials inventory $300,00
Dafna11 [192]

Answer:

$700,000

Explanation:

The computation of the total raw materials used is shown below:

= Beginning raw material inventory + purchase of raw material - ending raw material inventory

= $250,000 + $750,000 - $300,000

= $700,000

We simply added the purchase and deduct the ending inventory to the beginning inventory so that the raw material used could come

7 0
3 years ago
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