Please answer the questions and explain your answer :-

1. What is the best description of the discounted cash flow method for valuation purposes?

a. The sum of the future value of rents over a specified period of time

b. The sum of the present value of rents over a specified period of time

c. The ratio of rent over the sell price of the home

d. A discount paid at the purchase because the seller guarantees cash flow.

2. The income approach to property valuation is generally useful for what kind of buyer:

a. Retirees

b. First time homebuyer

c. Rental real estate investor

d. Flipper

3. Rev. Rul. 59-60 generally have following factors to consider except for:

a. The earning capacity of the company

b. The dividend-paying capacity of the company

c. The company's ability to lower the liability

d. The company's market price in the same or a similar line of business

e. None of the above

4. When a loss is disallowed under the related party loss rules, the loss:

a. is carried forward indefinitely

b. reduces the subsequent gain when the related party sells the asset

c. is lost forever even if the related party sells the asset at a gain

d. None of the above

5. Which of the following is true with respect to the related party rules?

a. A taxpayer's uncle is a related party for purposes of Section 267.

b. JH sells stock to his sister for a $3,000 loss. JH can deduct the loss on his tax return.

c. A disallowed loss on a related party transaction can be used to offset any future gain when the property is sold to an unrelated party.

d. Under the constructive ownership rules of Section 267, a shareholder owns 10 percent of the stock owned by a corporation in which he or she is a shareholder.

e. None of the above

6. In theory, the optimal method for establishing a transfer price is:

a. budgeted cost with or without a markup. b. market price. c. incremental cost. d. flexible budget cost.

7. List out at least two factors that valuation professionals may adjust for owner-level discount purposes and why?

8. Provide at least two tax rules that are similar to IRC Section 267 related party loss disallowance rule?