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To calculate the cash flow before debt service, you start with the potential income and then subtract the total operating expenses.

First, the potential income given is $499,475, which already accounts for the 5% vacancy loss. Therefore, this figure is the effective income you can expect to receive.

Next, you have the total operating expenses amounting to $188,379. To find the cash flow before debt service, you subtract these operating expenses from the potential income:

Cash Flow Before Debt Service = Potential Income - Operating Expenses

Cash Flow Before Debt Service = $499,475 - $188,379

Cash Flow Before Debt Service = $311,096

The calculation demonstrates that the cash flow before debt service is $311,096. This amount represents the income available to cover debt obligations and other financial commitments before any debt service payments are considered. Thus, this aligns perfectly with the correct interpretation of potential income and operating expenses.

The other options do not reflect this accurate calculation based on the provided figures.