Property Valuation
A Massachusetts property has a replacement cost of $350,000, land value of $150,000, and accrued depreciation of $75,000. What is the indicated value using the cost approach?
A$425,000✓ Correct
B$500,000
C$275,000
D$350,000
Explanation
Cost approach value = Land + (Replacement Cost − Depreciation) = $150,000 + ($350,000 − $75,000) = $150,000 + $275,000 = $425,000.
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