Most appraisers adhere to an "above-line" treatment of capital expenditures. This implies which of the following?
A) Capital expenditures are subtracted in the calculation of net operating income.
B) Capital expenditures are subtracted from net operating income to obtain a net cash flow measure.
C) Capital expenditures are added to net operating income.
D) Capital expenditures are excluded from all calculations because they are difficult to estimate.

Question

Quizplus · Accepted Answer

The Answer of Most appraisers adhere to an "above-line" treatment of capital expenditures. This implies which of the following?
A) Capital expenditures are subtracted in the calculation of net operating income.
B) Capital expenditures are subtracted from net operating income to obtain a net cash flow measure.
C) Capital expenditures are added to net operating income.
D) Capital expenditures are excluded from all calculations because they are difficult to estimate.

Most Appraisers Adhere to an "Above-Line" Treatment of Capital Expenditures