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Given the following information, calculate the funds from operation (FFO). Net income: $1,200,000, Gain/losses from infrequent and unusual events: $0, Amortization of tenant improvements: $120,000, Amortization of leasing expenses: $75,000, Depreciation (real property): $2,675,000.
A. $195,000
B. $1,395,000
C. $2,870,000
D. $4,070,000

Respuesta :

Answer:

Option (D) is correct.

Explanation:

Funds from operation:

= Net income - Gain/losses from infrequent and unusual events + Amortization of tenant improvements + Amortization of leasing expenses + Depreciation (real property)

= $1,200,000 - $0 + $120,000 + $75,000 + $2,675,000

= $4,070,000

Therefore, the funds from operation is $4,070,000.

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