Finance

A Missouri investor buys a property for $300,000 with a $240,000 loan at 6%. Annual debt service is $17,260. If NOI is $22,000, what is the debt coverage ratio (DCR)?

A1.10
B1.27✓ Correct
C1.40
D1.50

Explanation

DCR = NOI ÷ Annual debt service = $22,000 ÷ $17,260 = 1.27.

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