Malcolm purchased an old convenience store, and after renovations will open a small vegan grocery. He paid $517,000, of which $417,000 was for the building, and renovations cost him $107,000. What does the amount $524,000 represent?

amount $524,000 represent the Depreciable basis

Explanation:

given data

paid = $517,000

building = $417,000

renovations cost = $107,000

amount = $524,000

to find out

What does the amount $524,000 represent

solution

here amount $524,000 represent the Depreciable basis

because Depreciable basis is the acquisition cost of investment + renovations ... 1

Depreciable basis amount = $417,000 + $107,000 = $524,000

so here is the investment is depreciable basis

so that we can say that amount $524,000 represent the Depreciable basis