This includes the risk, time, interest, and recapturing depreciation of the property. The appraiser must first calculate the possible income from the real estate property, what kind of vacancies that may occur, costs for operating the property, to result to potential net income. Once the possible net income is computed the appraiser must chose a capitalization rate to create a reasonable market value. For residential property, this approach is usually not generally used because once the property is sold there is no profit or benefit to be gained by the owner. For income property, the process is similar to the sales comparison approach using the gross rent multiplier or the cash flow analysis for capitalization.
Passive Income is income that is earned through a trade or investments where the taxpayer does not spend much time or effort. It is called passive because it is not their main income. Portfolio Income comes from income directly from investments such as stocks and bonds, mutual fund investments, and interest income. 13. Briefly, what is "material participation"?
The sum of the market or appraised values of identifiable assets acquired less the fair value of liabilities assumed exceeded the cost to Easton. After revaluing noncurrent assets to zero, there was still some “negative goodwill.” Proper accounting treatment by Easton is to report the amount as A. part of current income in the year of combination. B. a deferred credit and amortize it. C. an extraordinary gain. D. paid-in capital.
24. While only certain leases are currently accounted for as a sale or purchase, there is theoretic justification for considering all leases to be sales or purchases. The principal reason that supports this idea is that a. all leases are generally for the economic life of the property and the residual value of the property at the end of the lease is minimal. b. at the end of the lease the property usually can be purchased by the lessee. c. a lease reflects the purchase or sale of a quantifiable right to the use of property.
a. What is the equilibrium price and quantity of fertilizer in an unregulated, competitive market? b. What is the efficient quantity of fertilizer? c. Suppose government imposes a tax equal to the marginal external cost.
The organization should primarily focus on the incremental cash flow because the incremental cash flow holds a marginal benefit from the project. Depreciation is considered to be an expense item which means that the greater the depreciation, the larger the expense will be to the organization. Therefore, if Caledonia was looking at the project from an accounting profit view, the profit would be much lower than that of the free cash flow. 2. What are the incremental cash flows for the project in years 1 through 5 and how do these cash flows differ from accounting profits or earnings?
What is land as a factor of production? (0.5 points) not just the surface of the earth, but everything in the universe that wasn't created by people 2. What does the Law of Demand say? (0.5 points) that if all other factors are equal, the demand will go down if the price goes up, and the demand will go up if the price goes down 3. What does the Law of Supply say?
Inventory purchases are debited to a Purchases account. b. Inventory records are not kept for every item. c. Cost of goods sold is recorded with each sale. d. Cost of goods sold is determined as the amount of purchases less the change in
The auxiliary enterprises expenses are not calculated in this amount because they include college operations that are usually intended to be self-supporting. Lee College’s total expenses equal an amount of $17,050,000 which
Answer: The paradox of value - is value of a good with a lower price but with a high value and a good with higher price with lower value. Paradox value is resolved by distinguishing between total utility and marginal utility. 12. What are the similarities between utility and temperature? Answer: They are both abstract concepts.