The profits and DRC methods

What does DRC stand for?

Which of these is not likely to be valued by the profits method?

• An office

• A cinema

• A tourist attraction

• A pub

• A EV charging station

Which of these are likely to be valued using the DRC method?

• A gym

• A bingo hall

• A factory

• A library

• A prison

Which of the profits and DRC method requires an investment yield for the calculation?

• The profits method

• The DRC method

• Both

• Neither

Which of these are types of depreciation used the DRC method? (select three)

• Economic

• Functional

• Physical

• Actual

• Relative

What is the EBITDA equivalent to?

• Gross profit

• Turnover

• Net profit

What does FMOP stand for?

Why does the profits method work on the basis that the business has a reasonably efficient operator?

• If a business runs unusually profitably or inefficiently that will skew the property value

• A business will do well if it has an efficient manager

• Inefficient operators will take a long time to value

• Company accounts can be made up which is inefficient

Is land value explicit in a DRC and profits valuation?

• Land value is just included in a profits valuation

• Land value is just included in a DRC valuation

• Land value is included in both

• Land value is included in neither

Which type of deprecriation is most common in company accounts?

• Straight line method

• Declining balance method

• S-curve method