Busi 331 Answer Guide 2 Lesson 2: Analysis Of Income And Expenses

This study source was downloaded by 100000868590658 from CourseHero.com on 06-15-2023 01:04:44 GMT -05:00https://www.coursehero.com/file/69153214/Assignment-2-Anspdf/ UBC Real Estate Division 2019 BUSI 331 Answer Guide 2 LESSON 2: Analysis of Income and Expenses 1. Answer: 1 Only the value of the building should be used to find the depreciation expense (0.60 $ 1,200,000) as land is not considered a depreciable asset. The annual depreciation expense on the building is $18,857. 2 . Answer: 1 3. Answer: 2 ( )( )( )( )n erpu - vepun erpu - vepu - FE110 $1, 300 - $410110 $1, 300 - $410 - ($87, 00DOLDOL8.98165 0)$97, 900$1 0 10, 90 ====== == The degree of operating leverage when n = 110 is 8.98%. This means that a 1% increase in occupancy, over 110 units, would trigger an increase of 8.98% of NOI. Cost Salvage Value $720,000 $60,000Depreciation = = = $18,857.14, rounded to $18,857Estimated Life (years) 35FEBEP (units) = (erpu vepu)$87,000 = $1, 300 $410 = 97.75 units, rounded to 98This study source was downloaded by 100000868590658 from CourseHero.com on 06-15-2023 01:04:44 GMT -05:00https://www.coursehero.com/file/69153214/Assignment-2-Anspdf/BUSI 331 Answer Guide 2 Page 2 UBC Real Estate Division 2019 4. Answer: 1 DOL = n(erpu - vepu) n(erpu - vepu)