MANAGEMENT

Detailed explanation-1: -Net operating income (NOI) is a commonly used figure to assess the profitability of a property. The calculation involves subtracting all operating expenses on the property from all the revenue generated from the property. The higher the revenues and the smaller the expenses, the more profitable a property is.

Detailed explanation-2: -Net operating income (NOI) is a real estate valuation method that measures the profitability of a revenue-generating real estate property. NOI is calculated by subtracting all operating expenses a property incurs from the revenue it generates.

Detailed explanation-3: -Operating income is defined as the company’s profit after deducting the operating expenses, which are the costs of running its everyday operations. Net income of a company is defined as the income that remains after factoring in all the debts, expenses, additional income streams and the operating costs.

Detailed explanation-4: -According to Net Operating Income Approach, the market value of the firm is not affected by its capital structure. The value of the firm and its overall cost of capital remains same irrespective of the proportion of debt (or financial leverage) in capital structure.

Detailed explanation-5: -The difference between net income and NOI is the expenses you include with each. Moreover, NOI includes only the expenses directly related to the running of your properties. Net income includes all expenses, plus capital gains/losses and extraordinary items.