The Cost Approach: Methods, Techniques, and Depreciation

摘要

The cost approach produces a cost estimate for repairing, replacing, or restoring the utility of the item. The cost approach is often applied to damaged or destroyed items, tree inventories, preconstruction bonds, and insurance claims. The principle of substitution is the foundation of the cost approach and can be critical to assessing the reasonableness of the conclusions (Appraisal Institute 2015: p. 225).