The calculation of effective gross income reflects:
A. depreciation
B. vacancies and collection losses
C. repairs and operating costs
D. taxes
Answer: B. vacancies and collection losses
Explanation: Effective gross income is calculated by subtracting a vacancy factor from the gross rental income, taking into account the probability that the property will not always be fully rented and all rents owed will not always be collected.
Business
You might also like to view...
In evaluating a strategic alternative, if there is little fit with the company's culture, what are management's options?
What will be an ideal response?
Business
What percentage of online credit card purchases are fraudulent in Internet retailing?
a. 3 percent b. 6 percent c. 11 percent d. 14 percent
Business