Question on discounted cash flow
I am in a Real Estate finance class, and we are going over discounted cash flow analysis to get NPV, IRR and whatnot. There are two examples that I do not understand because there is a conflict in the formulation of BTCF. Very basic concepts, so I will make this as easy to understand as possible:
-Both examples are for residential investment properties.
-Both have a second interest only mortgage taken out with principle due at the end of year 3.
-Example A has a holding period of 5 years, Example B has a holding period of 3.
-Example A subtracts the principle due at the end of year three from NOI to get BTCF
-Example B never subtracts out the principle due at the end of year 3, and only takes the yearly mortgage payment and the prepayment expense out.

Can anyone explain why this might be the case?
[{"id": "cwubq32", "text": "NEVERMIND its taken out of the gain on sale of the property since it is sold at the maturity date.", "replies": [], "depth": 1}]