Property Valuation

A Colorado appraiser determines: new building cost = $200,000, land value = $75,000, accrued depreciation = $40,000. What is the indicated value using the cost approach?

A$160,000
B$195,000
C$235,000✓ Correct
D$275,000

Explanation

Cost approach value = Land value + Depreciated cost of improvements = $75,000 + ($200,000 − $40,000) = $75,000 + $160,000 = $235,000.

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