Property Valuation
A Wyoming ranch's total acreage value is estimated through a 'land residual' technique. This technique is useful when:
AOnly the building is being valued
BThe improvement value is known and the land value must be derived from the total property value✓ Correct
CThe land value is known and the improvement value must be derived
DBoth land and improvement values are known
Explanation
The land residual technique is used in the income approach when the improvement value (cost new minus depreciation) is known. The portion of income attributable to the improvements is subtracted, and the residual income is capitalized to arrive at the land value.
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