CCIM 101 -FINANCIAL ANALYSIS ACTUAL
EXAM NEWEST VERSION ACTUAL 120
QUESTION AND CORRECT DETAILED
VERIFIED ANSWERS FROM VERIFIED
SOURCES BY EXPERT RATED A GRADE.
What are the four basic components of NOI? - answer-1 - Potential rental
income (PRI)
2 - Vacancy and credit losses
3 - Other income
4 - Operating expenses
[XXXX] is used to determine a property's PRI (Potential Rental Income.) -
answer-Lease analysis
A REIT must distribute what percent of its taxable income to stockholders
every year? - answer-90%
True or False: a REIT is subject to corporate-level tax on the taxable income it
distributes to stockholders. - answer-False. A REIT must pay out at least 90% of
its taxable income as dividends. Since those dividends are actually the taxable
, portion of the income generated by the REIT-owned properties, the company
is able to pass its tax burden to shareholders rather than pay Federal taxes
itself.
What is Section 1231 property? - answer-Section 1231 property is real or
depreciable business property (such as a commercial building) held for more
than one year.
The class life (depreciation period) of residential real estate improvements is
how long? - answer-27.5 years (or 3.636%/p.a.)
The class life (depreciation period) of NON-residential (commercial) real estate
improvements is how long? - answer-39 years (or 2.564% p.a.)
The Mid-month Convention: For cost recovery, taxpayers are required to use
what day of the month to establish the acquisition and disposition dates when
calculating cost-recovery deductions? - answer-15th
PRI equals NOI in what property/tenant scenario? - answer-If the property has
one tenant with a long-term absolute NNN lease.
[XXXX] is PRI minus vacancy and collection losses. - answer-ERI (Effective
Rental Income)
The basis for a property that is purchased equals the purchase price plus what?
- answer-Plus any capitalized acquisition costs (not financing costs.)
EXAM NEWEST VERSION ACTUAL 120
QUESTION AND CORRECT DETAILED
VERIFIED ANSWERS FROM VERIFIED
SOURCES BY EXPERT RATED A GRADE.
What are the four basic components of NOI? - answer-1 - Potential rental
income (PRI)
2 - Vacancy and credit losses
3 - Other income
4 - Operating expenses
[XXXX] is used to determine a property's PRI (Potential Rental Income.) -
answer-Lease analysis
A REIT must distribute what percent of its taxable income to stockholders
every year? - answer-90%
True or False: a REIT is subject to corporate-level tax on the taxable income it
distributes to stockholders. - answer-False. A REIT must pay out at least 90% of
its taxable income as dividends. Since those dividends are actually the taxable
, portion of the income generated by the REIT-owned properties, the company
is able to pass its tax burden to shareholders rather than pay Federal taxes
itself.
What is Section 1231 property? - answer-Section 1231 property is real or
depreciable business property (such as a commercial building) held for more
than one year.
The class life (depreciation period) of residential real estate improvements is
how long? - answer-27.5 years (or 3.636%/p.a.)
The class life (depreciation period) of NON-residential (commercial) real estate
improvements is how long? - answer-39 years (or 2.564% p.a.)
The Mid-month Convention: For cost recovery, taxpayers are required to use
what day of the month to establish the acquisition and disposition dates when
calculating cost-recovery deductions? - answer-15th
PRI equals NOI in what property/tenant scenario? - answer-If the property has
one tenant with a long-term absolute NNN lease.
[XXXX] is PRI minus vacancy and collection losses. - answer-ERI (Effective
Rental Income)
The basis for a property that is purchased equals the purchase price plus what?
- answer-Plus any capitalized acquisition costs (not financing costs.)
