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14 March, 08:57

Oliver bought a rental property in 2018. He paid $100,000 cash and assumed a mortgage of $75,000. At the time of purchase, the land was valued at $10,000. What is Oliver's depreciable basis in the property? a. $90,000 b. $100,000 c. $165,000 d. $175,000

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  1. 14 March, 12:51
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    Depreciable value will be equal to $165000

    So option (C) will be correct option

    Explanation:

    It is given Oliver bought a rental property. he paid $100000 cash and mortgage of $75000

    So total cost to Oliver = $100000+$75000 = $175000

    Value of land = $10000

    We have to find the depreciable basis in the property

    We know that land is non depreciable

    So depreciable value will be equal to = $175000 - $10000 = $165000

    So option (c) will be correct answer
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