Reproduction cost of building with same height = $27 Million
Heating and Air-conditioning cost = $50000
Roof repair cost = $250000
Repair amount = $50000
Increase of value of building = $300000
Negative impact of road = $100,000
Cost New = $27000000 + $50000 + $250000 + $50000 - $300000 + $100000
= $27.15 Million
Land Value = $5 Million
Property Value = Land Value + (Cost New – Accumulated Depreciation).
= $27.15 Million + $5 Million
= $32.15 Million
Hence property value is $32.15 Million.
EXAMPLE 23 The Cost Approach A 12-year-old industrial property is being valued using the cost approach....
solve the replacment The Cost Approach A 12-year-old industrial property is being valued using the cost approach. The appraiser feels that it has an effective age of 15 years based on its current condition. For example, there are cracks in the foundation that are not feasible to repair (incurable physical depreciation). That is, it would cost more to try to repair these problems than the value that would be created in the property. The appraiser believes that it has a...
Using the given information to estimate the property value through Cost Approach Cost Approach Reproduction Costs Assumptions House • Living area:2960 sf Garage • Living area, estimated cost of reproduction: $62.00 / sf Appliances • Garage, estimated cost of reproduction: $8,800 Total Reproduction • Appliances, estimated cost of reproduction: $2,400 Depreciation • Physical depreciation: 5% of total improvement costs Depreciated Cost of Building • Functional obsolescence: None Site Value • External obsolescence: None Misc Site Improvements • Site value, estimated:...
1. Using NPV approach, determine whether Tip Top Inc should lease or buy the new facility. Assume that you will be making your presentation before the company’s executive committee, and remember that the president detests sloppy, disorganized reports. 2. What response will you give in the meeting if Tony brings up the issue of the buildings future sales value? Tip Top Canadian Inc owns a nationwide chain of supermarkets. The company plans to open another in Montreal, Quebec. In discussion...
What is the answer to these tables? here is all the information that had been given to me and my answers to the question that I think needs to be answered to complete the two tablesYou have been hired as a Financial Consultant by Heavy Equipment and Machinery Inc. (HEMI). HEMI is a private corporation that has finished its first year of operations. HEMI's owners plan to list the business on the Toronto Stock Exchange (TSE) in the next 5 years; accordingly,...