Texas Property Tax Consultant Practice Exam

If the total cost of constructing an improvement was $668,175 and the depreciation is $240,543, what is the value attributed to the land if the property is valued at $607,632?

1. $60,543

2. $367,089

3. $180,000

4. $0.00

The correct answer is: $180,000

To determine the value attributed to the land, the first step is to calculate the value of the improvement by subtracting the depreciation from the total cost of constructing that improvement. In this scenario, the cost of constructing the improvement is $668,175, and the depreciation associated with that improvement is $240,543. Therefore, the value of the improvement after depreciation is calculated as follows: Value of Improvement = Total Cost - Depreciation Value of Improvement = $668,175 - $240,543 Value of Improvement = $427,632 Once we have the value of the improvement, the next step is to determine the total value of the property, which is already given as $607,632. To find the value attributed specifically to the land, we subtract the calculated value of the improvement from the total property value: Value of Land = Total Property Value - Value of Improvement Value of Land = $607,632 - $427,632 Value of Land = $180,000 This calculation reveals that the correct value attributed to the land is $180,000.