If a property sold for $172,000 and the replacement cost new is calculated at $136,000 with depreciation of $12,000, what is the value of the land?

To find the value of the land, the calculation begins with the sales price of the property, which is $172,000. You then need to consider the value of the improvements, which involves the replacement cost new and depreciation.

The replacement cost new for the improvements is $136,000. After applying the depreciation of $12,000, the depreciated value of the improvements becomes $124,000 ($136,000 - $12,000). To determine the value of the land, you subtract the value of the improvements from the total sold price.

Thus, the calculation for the land's value is as follows:

Land Value = Selling Price - Depreciated Value of Improvements

Land Value = $172,000 - $124,000

Land Value = $48,000

This means the value of the land is $48,000, which aligns with the correct answer. The reasoning relies on understanding that the total property value includes both land and improvements and that we need to isolate land value by calculating the depreciated value of the improvements first.