Real Estate Investment Analysis and Business Opportunity Brokerage Flashcards
An increase in value
appreciation
Anything of value
asset
A financial report that shows the company’s financial position at a stated moment in time.
balance sheet
The resulting amount when annual debt service, tax liability, and capital improvement costs are subtracted from net operating income.
cash flow
The risk that arises from the continual change in the business environment and therefore dynamic risk cannot be transferred to an insurer.
dynamic risk
The market value of a property less any debt against it; in a business entity, assets minus liabilities equals capital (owner’s equity); a system of legal rules administered by a court of chancery.
equity
The worth of a business, including real estate, goodwill, and earning capacity.
going concern value
An intangible asset (value) of a business.
goodwill
A summary of all income and expenses of a business for a stated period of time.
income statement
The outlay of money in anticipation of income or profit; the sum risked or the property purchased.
investment
The use of borrowed funds to finance the purchase of an asset; the use of another’s money to make more money.
leverage
An appraiser’s methodology and estimate of the value of a business that is being liquidated. An assessment of such factors as the ability of the firm to pay off short-term obligations, the value of the inventory on hand, and the liquidation value of preferred stock.
liquidation analysis
The ability to convert non cash assets into cash quickly; refers to a firm’s cash position and its ability to meet obligations.
liquidity
A method of pooling investment money using the trust form of ownership.
REIT
The chance of losing all or al part of an investment; the uncertainty of financial loss.
risk