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Given the following information, calculate the effective gross income. Property: 4 office units, Contract rents per unit: $2500 per month, Vacancy and collection losses: 15%, Operating Expenses: $42,000, Capital Expenditures: 10%A. $48,000
B. $60,000
C. $95,000
D. $102,000

Respuesta :

Answer:

D. $102,000

Explanation:

The computation of the effective gross income is shown below:-

Effective gross income = Gross income - Vacancy expense

=  ($2500 per month cost × 12 months × 4 office units) - ($2500 per month cost × 12 months × 4 office units × 15% collective losses)

= ($2,500 × 12 × 4) - (($2,500 × 12 × 4 × 15%)

= $120,000 - $18,000

= $102,000