most tenants have beenoffered inducements such as a month’s free rent or special decorating allowances. A check withcompeting apartment houses reveals that similar apartment unit rents for about RM895 permonth and that vacancies average about 5 per cent. Moreover, these other apartments have poolsand recreation areas that make their unit worth about RM20 per month more than those of theSated Satyr, which has neither.The tax assessor states that the apartment was reassessed 12 months ago and that the currenttaxes are RM71,400.Benedict learns that the resident manager at Sated Satyr, in addition to an RM10,000 salary, getsa free apartment for her services. He also discovers other expenses: insurance will cost RM6.50per RM1,000 coverage, based on estimated replacement cost of about RM1.8 million; worker’scompensation (RM140) must be paid to the state; utilities, incurred to light hallways and othercommon areas, cost about RM95 per month for similar properties; supplies and miscellaneousexpenses typically run about 0.25 per cent of effective gross rent. Professional management fees
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- Winter '16
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- Generally Accepted Accounting Principles, Arnold Benedict