Part A. Identify 1. Net Operating Income (Cash Flow Before Debt Service) and 2. Taxable profit or loss from the following scenario.

Gross Annual Income $75,000

Allowable depreciation 2.56% of building value

Property value $1,000,000

Operating expenses $ 35,000

Land Value $250,000

Interest on Loan $37,000

Part B: What is the tax exclusion for sellers of a primary residence?How long must you have lived in the home?