In the sales method of estimating depreciation, what is subtracted from the sales price?

In the sales method of estimating depreciation, the key point is to determine the value of a property based on its recent sale price while accounting for both the improvements made to the property and land value. When utilizing this method, the value of the land is subtracted from the sales price because it allows for a clearer view of what the improvements contribute to the overall property value.

By removing the land component, appraisers can focus on the relationship between the sale price and the depreciated value of the buildings or other improvements on the land. This approach helps in effective estimation of the actual worth of the property's improvements by isolating them from the value of the land, which typically appreciates over time relatively independently of the structures built upon it.

The other options do not directly relate to the sales price in the context of the sales method. For instance, while the cost of repairs and accrued depreciation are important factors to consider when analyzing a property's condition and overall value, they do not represent the specific calculation made in the sales comparison approach. The cost new of the improvements also doesn’t reflect the actual sales dynamics as it doesn’t necessarily represent the current market value of the improvements as is evident in sales transactions. Thus, subtracting the land value from the sales price accurately