Question

There production cost of a building Is $280,000. Accrued depreciation is estimated at $60,000. The estimated land value is $70,000. What is the estimated value of the property?

Answer 1

The estimated value of the property is calculated by adding the land value to the production cost of the building and then subtracting the accrued depreciation, resulting in an estimated property value of $290,000.

Step-by-step explanation:

The estimated value of the property can be calculated by adding the value of the land to the production cost of the building and then subtracting the accrued depreciation. The calculation is as follows:

• Value of land = $70,000
• Production cost of building = $280,000
• Accrued depreciation = $60,000

Estimated value of the property = (Value of land) + (Production cost of building) - (Accrued depreciation)

Estimated value of the property = $70,000 + $280,000 - $60,000

Estimated value of the property = $350,000 - $60,000

Estimated value of the property = $290,000