Net operating income (NOI) excludes which of the following?

Unlock all questions

This demo includes only 20 questions. Upgrade to access hundreds of questions, flashcards, exam simulations, and disable ads.

Full question bankExam simulationsFlashcards
From $24.99Unlock all

Master the Mckissock General Appraiser Sales Comparison Approach Test with comprehensive quizzes and explanations. Enhance your skills in the appraiser profession and pass your exam with confidence!

Multiple Choice

Net operating income (NOI) excludes which of the following?

Explanation:
Net operating income shows what the property can generate from operations after paying the ongoing operating costs, but before financing costs and taxes. Debt service, which is the mortgage payments, falls under financing, not operations, so it is not deducted when calculating NOI. The other items listed—property taxes, maintenance, and property management fees—are typical operating expenses and are subtracted from gross income to arrive at NOI. So the item that NOI excludes is the mortgage payments. For a quick view, GOI minus operating expenses (excluding debt service) equals NOI.

Net operating income shows what the property can generate from operations after paying the ongoing operating costs, but before financing costs and taxes. Debt service, which is the mortgage payments, falls under financing, not operations, so it is not deducted when calculating NOI. The other items listed—property taxes, maintenance, and property management fees—are typical operating expenses and are subtracted from gross income to arrive at NOI. So the item that NOI excludes is the mortgage payments. For a quick view, GOI minus operating expenses (excluding debt service) equals NOI.

More Multiple Choice Questions
Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy