What is the total of selling cost, overhead, contingencies, carrying costs, and developer's profit?

Study for the Certified General Appraiser Exam. Explore flashcards and multiple-choice questions with hints and explanations to prepare effectively. Get ready for your certification!

To determine the total of selling cost, overhead, contingencies, carrying costs, and developer's profit, you must add each component related to the costs associated with a project. In appraisals, these components are critical in assessing the overall financial feasibility of a development or property project.

When you sum up the individual costs:

  1. Selling costs typically encompass expenses related to marketing and selling the property.

  2. Overhead includes fixed costs that support the business, such as administrative expenses and salaries.

  3. Contingencies account for unforeseen expenses that may arise during the project.

  4. Carrying costs encompass all expenses incurred while holding the property, such as taxes, insurance, and maintenance.

  5. Developer's profit represents the expected return on investment for the developer's efforts and risk.

To arrive at the correct total, you would perform an addition of these components. Since the total identified in option B amounts to $460,800, it suggests a thorough calculation or a specific combination of these costs that collectively results in this amount.

Detailed calculations or assumptions about each component would lead to establishing this figure accurately, reinforcing the conclusion that an understanding of each cost component plays a significant role in appraising the value and economic viability of a real estate project.

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