Real Estate Finance 7

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Qualifications and Recommendations when Working with Clients

Introduction: As a real estate agent you are usually operating as an independent contractor. This means that you run your own business and are the business owner, even though you work for a broker. As a business owner you will quickly find that “time is money” and will not want to waste your time or your clients time, by showing them property that they are not qualified to buy.

The following Course Outcome is assessed in this Assignment:

MT431-3: Determine the most financially viable product for a real estate client.

Introduction:

A real estate professional must understand the client’s personal as well as financing options to be able to service all of the client’s needs. You will examine a client scenario to practice these skills.

Scenario: Henri’s older sister Suzanna age 52, has been referred to you so you can help her with her search for a new home near Henri and Lila (about one half hour outside of Philadelphia). Although she has not quite decided as yet, she is hoping to retire in 15 years and would like a house in which she can grow old.

She is interested in the following homes: Home #1: $200,000 for a 1400 square foot home; Home #2: $250,000 for a 1600 square foot home. Currently fixed rate loans are running about 4%. Up until now she has been renting in Louisiana and doing part-time consulting work which brings in an average monthly income of $3,000 a month. She has been consulting for about 20 years and has hopes that the company she has worked for all this time is going to hire her on as a full-time salaried

Assignment Details

 

 

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employee soon at a steady $4,000 per month. She has a

FICO® score of 720 and she pays $300 a month towards her car loan. She recently inherited $15,000 from a favorite aunt which is what she wants to put down on a home and pay for closing costs of about $5,000. Currently banks in the area require a payment ratio of 33% and a debt ratio of 45%.

Part 1:

Determine Suzanna’s qualifications as a buyer.

Explain how you would determine the real estate value.

Examine the parameters that must be considered, and explain what you would advise her.

Explain how your assessment would affect how you would work with this client.

Part 2:

Based on Suzanna’s finances as stated above, determine which property and mortgage would be most suitable for her. Explain your choice.

Access the Unit 7 Assignment grading rubric.

Submit your minimum 600-word document in APA format and citation style to the Unit 7 Assignment Dropbox.

 

https://kapextmediassl-a.akamaihd.net/business/MT431/1904c/rubrics/u7_rubric.pdf

Shannan Doss and Gabriela Santos

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Week 2 – Discussion Forum 1

 

Guided Response: Review the posts from your classmates and respond to at least two. Compare and contrast the points you and your classmates made regarding the importance of preparing a sales projection in the process of financial forecasting. Each response should have a minimum of 100 words.

 

 

On this Document there two classmates with discussion that needs to be response. Shannan Doss and Gabriela Santos

 

 

Shannan Doss

Hello Class,

When organization want to project where they want to go, they prepare a pro forma financial statement. This statement along with the cash statement and that balance sheet, allows a company to estimate their future expenses and possible profits that they will gain. There are four steps that are used when developing a pro forma income statement; establishing a sales projection, determine a production schedule, computing other expenses and determining profit by completing the actual pro forma statement, (Block, Hirt, & Danielsen, 2019, p.98).

The first step in developing a pro forma income is critical because, to have a meaningful and correct sales projection allows the company to have an appropriate amount of inventory in order to predict any future profits. It predicts the company’s anticipated needs by assessing the past and current sales results. The sales projection is measured in how many units are in inventory and by the selling price per unit.  “It is important for financial managers to realize that projections are often inherently risky” (Block, Hirt, & Danielsen, 2019, p.99).

Based on Deere’s Second-Quarter Reports, it states that the company’s net sales and revenues are projected to rise 5% to $10.3 billion. By the end of the second quarter, the company reported a net income of $1.135 billion or $3.52 per share, which had risen from the prior year’s net income of $1.208 billion. Results were favorable for the company in 2018, however due to the discrete adjustments to the provision for income taxes, the company was unfavorable affected by an $803 million tax reform. The equipment operating sales and profit net sales were increased by 3%. The Agriculture & Turf sales’ numbers for the quarters were higher due to the higher shipment price and volumes. The operations profits declined as well due to the higher production costs. The company will need to adopt more of a financial outlook for the agricultural sector.

Shannan D.

Reference:

Block, S. Hirt, G. A., & Danielson, B. R. (2019). Foundations of financial management (17th edition) Retrieved from https://www.vitalsource.com/ (Links to an external site.) (Links to an external site.)

 

John Deere. (n.d.). Investor relations (Links to an external site.) (Links to an external site.). Retrieved from https://investor.deere.com

 

 

 

Gabriela Santos

The pro forma income statement is important because it is a great way to guide a company into the future. The first step to preparing a pro forma income statement is building a sales projection. Based on the sales projection, the rest of the statement comes together (Block, Hirt, & Danielson, 2019).

The sales projections are essential because they carry a lot of weight for a company. The textbook warns that marketing teams can promote optimistic sales projections that may not be met based on current events. External forces, like gas prices, can affect a business positively or negatively. When sales projections are not met, it can negatively impact the company’s stock. It’s advised that a good financial officer will evaluate how risky sales projections are. It’s also a good practice to consider worst-case scenarios so a company is prepared just in case (Block, Hirt, & Danielson, 2019).

Deere & Company shares its sales results within the context and explain their numbers with text. While some of the numbers show an increase in net sales, due to currency translation it actually turns in to a negative downward trend from year-to-date. They also make sure to show how gains and losses are offset by other forces.

Issues that Deere faces is its flattening sales or declining sales in several markets like in Asia. They also cite current currency exchange rates as a problem for them. They share that their projections are cautious due to the agricultural industry. As a response, they are being strategic with inventory. Overall, Deere is still optimistic about the future and hope with a new plan they will be successful.

Resources:

Block, S. B., Hirt, G. A., & Danielson, B. R. (2019). Foundations of financial management (17th ed.). Retrieved from https://www.vitalsource.com/

John Deere. (n.d.). Investor relations (Links to an external site.). Retrieved from https://investor.deere.com

Shareholder Analysis

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FIN/571: Corporate Finance

Wk 4 – Apply: Signature Assignment: Shareholder Analysis [due Mon]

Wk 4 – Apply: Signature Assignment: Shareholder Analysis [due Mon]

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Assignment Content

1.

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Continue your work with the company you selected in Wk 2. (I used Apple)

 

Research Apple’s financial reports for 2017.

 

Complete a 2- to 3-page FAQ/Shareholder Analysis.

 

Evaluate economic conditions that influence company performance. Consider political, environmental, currency (money), global economics, and government influences on economic conditions.

Compare market conditions with the company’s performance for 2017. Conclude how the market conditions that year influenced the company’s performance, such as interest rates, Federal Reserve Bank monetary policy changes, or other market conditions relevant to the company you selected.

 

Analyze year-over-year performance from 2016 and 2017. Consider key metrics or ratios such as trailing PE ratio, forward PE ratio, price to book, return on assets, and return on equity in your conclusions.

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Marketing Sports Equipment

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Marketing Sports Equipment

The purpose of this assignment is for you to propose a sales promotion based on what you know about the product and the target market. For this assignment, read Case 2 that is titled “Marketing Sports Equipment” on page 362 of your textbook. After reading and studying the details of the case, respond to the following questions with thorough explanations and well-supported rationale:

Academy Sports + Outdoors offers products that would appeal to a variety of target markets. Identify a minimum of three target market groups using the following denotations: TM1: xxx, TM2: xxx, and TM3: xxx. Remember to think about demographic, behavioral, psychographic, and geographic criteria when defining each target market.

For each of the target markets identified in question #1, what two types of consumer sales promotions (discussed in Chapter 12) should Academy Sports + Outdoors offer?

Explain.

Looking at each target market you proposed in question #1, what are two types of media that might be the most effective in reaching each of the target markets? Which two might not be as effective? Include your rationale.

The case states that Academy Sports + Outdoors receives a high volume of requests for sponsorship activities. Based upon the target markets you identified, what sponsors would you recommend that the company partner with?

Your response should be a minimum of two, double-spaced pages. Include a title page and references page. References should include your textbook and a minimum of one additional, credible source. All sources used, including the textbook, must be referenced; paraphrased and quoted material must have accompanying citations and must be cited per APA guidelines.