analyze a real estate investment scenario involving the purchase of a small multi office property. You will calculate key financial metrics and consider the tax implications for an investor in the 28% tax bracket.

Instructions:

1. Property Information:

- Purchase Price: $350,000

- Cash Down Payment: $100,000

- Loan Amount: $250,000

- Loan Interest Rate: 10%

- Loan Term: 10 years

- Annual Gross Income: $50,000

- Operating Expense Ratio: 30%

- Land Value: $50,000

- Improvements (Building) Value: $300,000

- Depreciation Rate: 39% straight-line

2. Calculate the following financial metrics for the property:

a. Net Operating Income (NOI): Calculate the NOI by subtracting the operating expenses from the annual gross income.

b. Annual Mortgage Payment: Calculate the annual mortgage payment using the loan amount, interest rate, and loan term.

c. Cash Flow Before Tax: Determine the cash flow before tax by subtracting the annual mortgage payment from NOI.

d. Taxable Income: Calculate the taxable income by subtracting depreciation from the cash flow before tax.

e. Income Tax: Calculate the income tax at a 28% tax rate on the taxable income.

f. Cash Flow After Tax: Calculate the cash flow after tax by subtracting income tax from the cash flow before tax.

g. Return on Investment (ROI): Calculate the ROI by dividing the cash flow after tax by the initial cash down payment.

3. Prepare a report summarizing your findings. Include the following sections:

- Property Information: Provide details about the property and the financial terms.

- Calculations: Present the results of your calculations for NOI, cash flow, taxable income, income tax, and ROI.

- Conclusion: Summarize your analysis and provide a recommendation on whether or not this real estate investment is financially viable for an investor in the 28% tax bracket.