# ii. Income, Cash Flow & Returns Income, cash flow, and returns describe how real estate assets generate earnings and how those earnings translate into investor outcomes. These concepts connect operating performance to valuation, financing decisions, and risk assessment. #### **Cash Flow Before Tax (CFBT)** Net cash generated by a property after operating expenses and debt service, before taxes. #### **Cash Flow After Tax (CFAT)** Net cash remaining after operating expenses, debt service, and applicable taxes are paid. #### **Cash-on-Cash Return** A return metric measuring annual pre-tax cash flow relative to the initial equity investment. #### **Debt Service** Scheduled principal and interest payments required under a loan agreement. #### **Distribution** Payments made to equity holders from available cash flow according to ownership agreements. #### **Gross Yield** Income generated by a property expressed as a percentage of its purchase price or value, before expenses. #### **Internal Rate of Return (IRR)** A time-weighted return metric reflecting the annualized rate of return over an investment’s holding period. #### **Net Cash Flow** Cash remaining after all operating expenses, capital expenditures, and financing obligations. #### **Return on Equity (ROE)** A measure of profitability calculated as net income relative to invested equity. #### **Yield** A general term describing income generated by an investment relative to its cost or value. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://info.building.inc/lexicon/finance-valuation-and-risk/ii.-income-cash-flow-and-returns.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.