When measuring functional obsolescence from a superadequacy under a REPRODUCTION cost basis, the deduction generally includes:

Correct Answer

C) The excess cost less contribution, adjusted for depreciation already taken

Why this is correct: Under a reproduction cost basis, the cost to duplicate the superadequate feature exactly is included. The deduction for functional obsolescence is the excess cost of that feature (the cost above what a standard, adequate feature would cost or above its contributory value), adjusted to avoid double-counting any physical depreciation already applied. Why the other choices are wrong: "Nothing further, since reproduction cost already includes everything" ignores the need to deduct the superadequacy penalty. "Only the item's maintenance contract" is incomplete; the main penalty is the excess construction cost. "The full original cost of the entire building" is excessive; only the superadequate portion is penalized. Exam tip: Reproduction cost includes superadequacies; you must deduct their excess cost. Replacement cost avoids this by designing a modern equivalent.