HP 12c Platinum Reference Manual page 18

18 Real Estate
12c platinum / 12C
RPN Keystrokes
3291.75?3
75000?4
20?5
125?6
35?7
6?8
2.5?9
5?.0
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Example 2: An office building was purchased for $1,400,000. The value of depreciable
improvements is $1,200,000 with a 35 year economic life. Straight line depreciation will
be used. The property is financed with a $1,050,000 loan. The terms of the loan are 9.5%
interest and $9,173.81 monthly payments for 25 years. The office building generates a
Potential Gross Income of $175,200 which grows at a 3.5% annual rate. The operating
cost is $40,296.00 with a 1.6% annual growth rate. Assuming a Marginal Tax Rate of
50% and a vacancy rate of 7%, what are the After-Tax Cash Flows for the first 5 years?
12c platinum
ALG Keystrokes
3291.75?3
75000?4
20?5
125?6
35?7
6?8
2.5?9
5?.0
t
t
t
t
t
t
t
t
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t
Display
1st year operating cost.
3,291.75
Depreciable value.
75,000.00
Useful life.
20.00
Declining balance factor.
125.00
Marginal Tax Rate.
35.00
Potential Gross Income
6.00
growth rate.
Operating cost growth.
2.50
Vacancy rate.
5.00
Year 1
1.00
ATCF
-1,020.88
Year 2
2.00
ATCF
-822.59
Year 3
3.00
ATCF
-598.85
Year 4
4.00
ATCF
-348.94
Year 5
5.00
ATCF
-72.16
Year 6
6.00
ATCF
232.35
Year 7
7.00
ATCF
565.48
Year 8
8.00
ATCF
928.23
Year 9
9.00
ATCF
1,321.62
Year 10
10.00
ATCF
1,746.81
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