Unit 4 Flashcards
Net operating income is total income minus operating expenses before debt service.
True
False
True
An employer is responsible for withholding income taxes and paying a portion of the employee’s social security taxes.
True
False
True
Current and expired leases should be filed together, by building.
True
False
False
A management pricing worksheet is useful when calculating charges for a condominium community.
True
False
True
A tax credit is an expense item like depreciation.
True
False
False
Fixed expenses refer to expenses that:
a. fluctuate every year.
b. are put aside for improvements.
c. do not fluctuate with the amount of occupancy.
d. increase or decrease with the amount of occupancy.
c. do not fluctuate with the amount of occupancy.
Which portion of debt service should be considered an expense on the profit and loss statement?
a. Principal and interest
b. Interest portion only
c. Principal portion only
d. Neither principal nor interest is considered on the profit and loss statement
b. Interest portion only
A budget forecast should be based on anticipated rental increases.
True
False
False
When both fixed and variable expenses are deducted from gross collectible income, the result is:
a. net operating income.
b. effective gross income.
c. potential gross income.
d. personal income.
a. net operating income.
The per-unit fee of a small property should be
a. decreased in buildings with problem tenants.
b. decreased where there is deferred maintenance.
c. increased whenever possible.
d. increased due to inefficient decentralization.
d. increased due to inefficient decentralization.
The form an employer must file for all income and taxes withheld from an employee is called a
a. W-2.
b. W-4.
c. 1099.
d. 941.
d. 941.
Which type of depreciation is deductible for tax purposes?
a. Physical deterioration
b. Functional obsolescence
c. Economic obsolescence
d. Locational deterioration
a. Physical deterioration
If the manager is required to live on the premises, the manager
a. must pay taxes on the fair market value of the rent.
b. must pay into social security based on fair market value.
c. does not have to pay taxes on the fair market value of the rent.
d. must file a 1099 on the fair market value.
c. does not have to pay taxes on the fair market value of the rent.
An example of direct costs is:
a. general office overhead.
b. accounting department expenses.
c. corporate advertising.
d. resident manager’s salary.
d. resident manager’s salary.
