Question - Comerical Property

Leasable Space= 300,000 Sq Ft Cap Expenditures= 20% of EgI

Average Annual Rent = 17.00/sq ft LTV= 80%

Average Annual Growth= 2.5%/year Loan Intrest Rate = 6%

V&C Losses = 8% of PGI Amortization= 30 yrs

Operating Expenses = 35% of EGI % Bldg/Total Value= 75%

Miscellaneous Income= $1.50/sq ft Coprate Tax rate= 30%

MI Annual Growth= 2% /year Cap gains Tax Rate=15%

Going-Out Cap Rate = 10.5% Accum Dep Tax Rate = 25%

Discount Rate = 10% Years of ownership=5 Years

Selling expenses= 6% Purchase Price= $22.5M

What are the Taxes Due at the end of the second year?

A. $475,842

B. $579,405

C. $336,965

D. $367,549