Real Estate Math

An Iowa building depreciates using straight-line depreciation over 27.5 years (residential). The building cost is $220,000. What is the annual depreciation expense?

A$7,273

B$8,000✓ Correct

C$11,000

D$6,050

Explanation

Annual straight-line depreciation = Building Cost / Useful Life = $220,000 / 27.5 = $8,000 per year.

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