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Solutions To Real Estate Finance

1. To calculate the selling price needed to give a net of P4,895,000 to the seller after expenses of 6% capital gains tax and 5% commission, the selling price is P5,500,000. 2. To calculate the selling price needed to give an acquisition cost of P6,300,000 after expenses of 30%, the selling price is P9,000,000. 3. To calculate the selling price needed to give a net of P6,500,000 to the owner after expenses of 5% commission, 1.5% capital gains tax, and 1.5% doc stamps, the selling price is P7,428,571.

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Rejesh Melad
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73 views1 page

Solutions To Real Estate Finance

1. To calculate the selling price needed to give a net of P4,895,000 to the seller after expenses of 6% capital gains tax and 5% commission, the selling price is P5,500,000. 2. To calculate the selling price needed to give an acquisition cost of P6,300,000 after expenses of 30%, the selling price is P9,000,000. 3. To calculate the selling price needed to give a net of P6,500,000 to the owner after expenses of 5% commission, 1.5% capital gains tax, and 1.5% doc stamps, the selling price is P7,428,571.

Uploaded by

Rejesh Melad
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Assignment:

1. Solution:
Expense of seller = 6% (CGT) + 5% (commission) = 11%
Selling price = Net to Seller/(100% of expenses) = P4,895,000.00 / (100%-11%)
=4,895,000/0.89 = P 5,500,000.00

2. Solution

Selling price = Acquisition Cost / (100%-30%) = 6,300,000.00 / 70% = 9,000,000.00

3. Given: Net price to owner = P 6,500,000.00


Commission = 5% of selling price
Capital Gains Tax = 1.5% of selling price
Doc stamps = 1.5% of selling price

SP = 6,500,000 / (100%-5% - 6% -1.5%) = 6,500,000,00 / 0.875


SP= P 7,428,571.429

4. Solution
a) Selling Price = P6, 300,000.00 + 30% (P6, 300.00) = P 8,190,000.00

b) Selling Price incl. commission


P8,190,000/(100%-5%) = P8,190,000/95% = P8,621,025.63

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