Cost Approach

A building cost $2,500,000 to construct 8 years ago. Using straight-line depreciation over a 40-year life, what is the current depreciated value?

A property has a replacement cost of $1,800,000. Physical deterioration is estimated at $200,000, functional obsolescence at $150,000, and external obsolescence at $100,000. What is the depreciated value using the breakdown method?

In a cost approach for a proposed building, the appropriate cost basis is generally:

A commercial building cost $2,500,000 to construct. The land value is $600,000. If the building has suffered 15% physical deterioration and 8% functional obsolescence, what is the depreciated cost of the improvements?

A warehouse cost $210,000 to build when the cost index stood at 105. The index is now 210. Its indicated current cost is:

Using the age-life method, what is the accrued depreciation for a 15-year-old building with a total economic life of 60 years and a reproduction cost of $400,000?

In the cost approach, economic obsolescence is characterized as:

Functional obsolescence can be caused by:

What is the primary difference between effective age and actual age of a building?

A building with an actual age of 20 years and an effective age of 25 years would indicate:

Physical deterioration in the cost approach refers to:

A building was constructed 15 years ago but appears to be in the condition of a typical 10-year-old building due to excellent maintenance. What is the building's effective age?

A building cost $800,000 to construct and has an economic life of 40 years. Using straight-line depreciation, what is the annual depreciation amount?

A home has a poorly designed kitchen with inadequate counter space and an awkward work triangle. This represents which type of depreciation?

The age-life method expresses depreciation as:

Which of the following is an example of functional obsolescence?

Which of the following BEST describes external obsolescence?

A building cost $750,000 new and is 8 years old with a 60-year economic life. Using straight-line depreciation, what is the current depreciated value?

Using the straight-line method, what is the annual depreciation for a building with a cost new of $500,000 and an economic life of 40 years?

Market extraction of depreciation is limited by the fact that it:

Functional obsolescence caused by a deficiency is measured as curable when:

Curable physical deterioration is measured at cost to cure because:

A 2,050 sq ft dwelling is priced at $178 per square foot with a $34,000 detached garage and $21,500 of site improvements. Cost new is:

A house has three bedrooms sharing one bathroom, and adding a second bath is economically justified. This is:

Direct costs in a construction budget include:

An appraiser writes that a 40-year-old house has an effective age of 10 but describes original wiring, original kitchen and a 25-year-old roof. The report's problem is:

Which of the following would be classified as functional obsolescence?

A 45-year-old office building has undergone extensive system upgrades (HVAC, electrical, fire suppression) and interior modernization, resulting in strong tenant demand and rental rates exceeding those of newer buildings in the area. The appraiser estimates its total economic life at 65 years. Which statement best reflects the likely relationship among its chronological age, effective age, and remaining economic life?

Which type of depreciation is considered incurable if the cost to cure exceeds the value added?

An improvement cost $500,000 to construct new. It is 8 years old with a total economic life of 40 years. Using straight-line depreciation, what is the current depreciated value?

A building cost $2,500,000 to construct. After 8 years, it has accrued depreciation of $400,000. Using straight-line depreciation, what is the annual depreciation amount?

In the breakdown method, the sequence of deductions is:

External obsolescence is best described as:

A commercial property's value falls after a competing center opens nearby. This loss is:

Paired sales show homes adjacent to a new commercial development sell for $28,000 less. The subject's land represents 30% of total value. The improvements' share of the external obsolescence is:

If a building's effective age exceeds its actual age, the appraiser is describing a building that has been:

Cost new $400,000; curable items $12,000; ratio for the remaining components 20%. Modified age-life depreciation totals:

A 2,400 sq ft house is estimated at $145 per square foot, with a garage adding $28,000 and site improvements $14,000. What is the total cost new?

An appraiser must choose between pricing an exact replica of a 1948 house and pricing a modern equivalent. What distinguishes reproduction cost from replacement cost?

Rent loss of $250 per month is attributed to a subject's location beside a truck depot, and the market multiplier is 110 (monthly GRM). What external obsolescence does capitalization indicate for the whole property?

A building has a reproduction cost new of $850,000. Physical depreciation is estimated at 15%, functional obsolescence at 8%, and external obsolescence at 5%. What is the depreciated value of the improvements?

An over-built custom home has heating bills double the neighborhood norm because of its cathedral volumes. Beyond excess construction cost, its superadequacy also creates:

Which locational change would most likely create external obsolescence for adjacent homes?

External obsolescence may be temporary when it results from:

A comparable sold for $390,000; its site is worth $110,000 and its improvements would cost $350,000 new. Total depreciation by market extraction is:

A house was built in 1985 but has been well-maintained and recently updated. If the appraiser determines the effective age to be 12 years and the total economic life to be 60 years, what is the remaining economic life?

When a cost service's figures are used, the appraiser should verify that the quoted base includes or excludes:

A superadequacy under a reproduction cost basis is measured including:

A house is being valued in a market where recent sales run far below replacement cost new less depreciation. This gap most likely signals:

When cost figures come from a cost service, the appraiser should verify: