Answer:
Original Cost of building=$395000
Step-by-step explanation:
Formula:
Straight line depreciation Expense=Depreciable amount/Useful life of asset
In our Case:
Depreciable amount is not given
Depreciable expense=$15000
Useful life of asset =25 years
Using aboe formula depreciable amount can be calculated as:
Depreciable amount= Depreciation Expense* Useful life of asset
Depreciable amount=$15000*25
Depreciable amount=$375000
In order to calculate the original cost we also have to include residual cost in depreciable amount.
Original Cost of building=Depreciable amount + Residual Cost
Original Cost of building=$375000+$20000
Original Cost of building=$395000
