How do you calculate cash on cash return on refinance

[Mike M.]

How are you guys calculating your cash on cash return after you cash out refinance once or twice. After initial acquisition of property its easy at:

Excess annual cashflow / initial equity injection 

So let’s say you guys a property:

$100,000 down on a $500,000 property, resulting in a $400,000 loan with the property throwing off $10,000 a year in excess CF after all expenses and mortgage payments. That’s a 10% cash on cash. 

Two years later you refinance, new value is $650,000 and you refinance at 80% LTV. Therefore new loan amount is $520,000 with $130,000 left in equity.

After you refinance is there a best way to calculate cash on cash correctly in this new cash-out scenario? Essentially in later scenario you’ve pulled out all of original cash injection monies