Dove Corp. began operating a hardware store in the current year after constructing a building at a total cost of $100,000 on land previously acquired for $50,000. In the current year, the land had a fair market value of $60,000. Dove paid real estate taxes of $5,000 in the current year. What is the total depreciable basis of Dove's business property?

Question

Business

Cristina Cisneros

17 July, 13:17

Dove Corp. began operating a hardware store in the current year after constructing a building at a total cost of $100,000 on land previously acquired for $50,000. In the current year, the land had a fair market value of $60,000. Dove paid real estate taxes of $5,000 in the current year. What is the total depreciable basis of Dove's business property?

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Jackson Owens · Answer 1

100,000 building will be the amount subject to depreciation

Explanation:

The land doesn't depreciate.

The land is the real state property, it is not depleted and neither suffers a loss of value through time.

The real state taxes are tax expenses for the period.

The depreciable basis will be the bulding which is affected for the past of time.