When using the cost approach to estimate the value of a property, which of the following would MOST LIKELY be used?
A. The current income and capitalization rate.
B. The loan amount needed to build the improvement at current price.
C. The estimated current cost of constructing the improvement plus appreciation.
D. The estimated current cost of construction the improvement less depreciation.
Answer: D. The estimated current cost of construction the improvement less depreciation.
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Ipswich Corporation is considering an investment opportunity with the expected net cash inflows of $300,000 for four years
The residual value of the investment, at the end of four years, would be $70,000. The company uses a discount rate of 14%, and the initial investment is $290,000. Calculate the NPV of the investment. Present value of an ordinary annuity of $1: 12% 13% 14% 15% 1 0.893 0.885 0.877 0.87 2 1.69 1.668 1.647 1.626 3 2.402 2.361 2.322 2.283 4 3.037 2.974 2.914 2.855 5 3.605 3.517 3.433 3.352 Present value of $1: 12% 13% 14% 15% 1 0.893 0.885 0.877 0.87 2 0.797 0.783 0.769 0.756 3 0.712 0.693 0.675 0.658 4 0.636 0.613 0.592 0.572 5 0.567 0.543 0.519 0.497 What will be an ideal response
Eighteen months before filing bankruptcy, Todd sells his motorcycle to his brother for $1 with the agreement that his brother will sell it back to Todd after Todd files for bankruptcy and receives a discharge of his debts. If the trustee can prove that Todd intended to defraud creditors with this transaction, which of the following is likely to happen?
A. Nothing because this is a valid contract with consideration given by both parties. B. This transaction will be reversed because it was a preference C. Nothing, because eighteen months is longer than 90 days, so the trustee has no power to take the motorcycle. D. Todd’s brother will be charged with the crime of theft from the bankruptcy estate. E. Todd’s brother will have to deliver the motorcycle to the trustee as this is a fraudulent transfer.