Property Management Licensing Practice Exam · Question
A multi-residential property in Halifax has an annual Net Operating Income (NOI) of $600,000. The annual debt service (principal and interest payments on the mortgage) is $350,000. What is the annual pre-tax cash flow for this property?
Pre-tax cash flow is calculated as Net Operating Income (NOI) minus annual debt service. Cash Flow = NOI - Debt Service = $600,000 - $350,000 = $250,000.
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Question: A multi-residential property in Halifax has an annual Net Operating Income (NOI) of $600,000. The annual debt service (principal and interest payments on the mortgage) is $350,000. What is the annual pre-tax cash flow for this property?
Answer options: ✅ $250,000
- $350,000
- $600,000
- $950,000
Correct answer: $250,000
Explanation: Pre-tax cash flow is calculated as Net Operating Income (NOI) minus annual debt service. Cash Flow = NOI - Debt Service = $600,000 - $350,000 = $250,000.
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