Using the following information, compute net operating income ( NOI ) for the first year of operations. Use an “above-line” treatment of capital expenditures.

• Number of apartments: 10

• Rent per month per apartment: $900.00

• Expected vacancy and collection loss: 10 percent

• Annual maintenance: $18,000

• Property taxes: $9,000

• Property insurance: $7,000

• Management: $8,000

• Capital expenditures: $5,000

• Other operating expenses: $3,000

• Annual mortgage debt payments: $35,000