Subtract the existing roof life cost from the new roof cost.

Subtracting my estimated holding costs of $7800 from that leaves nearly $20K in flexible repair costs and about $55K in profit.My question to all of you is, am I doing anything wrong? 

The difference will be your NOI which only then do you subtract debt service (i.e. mortgage).  

After the property sells, subtract your "payment" for the labor and then split whatever is left 50/50.

Assuming a$43k initial investment (All cash), with a 5 year hold at $750 per month income, subtracting out 20% for expenses, and a sale in the fifth year at $75k yields a return of over 20% per year, slightly less when you account for taxes/capital gains.Using debt at 50% instead of purchasing all cash jumps the return into the mid 40% range per year.Better than the stock market.

Should that $30,000 be subtracted from the price of the property?

You could have $108K in a savings account if you saved $3K a month for the next 3 years, plus another almost $14,400 ($400/mo. negative cashflow x 36 months) that you wouldn't have spent on negative cashflow/repairs/vacancy/etc.So if you take $122,400 and subtract out the $20K loss you would have to take in order to sell the property right now, you would still have over $100K in cash 3 years from now.

You calculate your CAP rate, before subtracting the P&I.

But then you must subtract PITI which is the payment interest taxes insurance.

Strictly going by the 1% rule, I'd have to subtract the $100/month utility bill from the rent to arrive at a price.