Which of the following values is divided by sales price to compute the Sales Ratio?

The Sales Ratio is computed by dividing the assessed (appraised) value by the sales price. This ratio is an essential tool in property assessment and appraisal as it provides insight into how closely property assessments align with actual market transactions.

In this context, the assessed value is determined by the local assessment authority and represents the value at which a property is taxed. The sales price, on the other hand, is the amount for which the property actually sold in the market. By using the assessed value in the computation, one can evaluate the effectiveness of the assessment practices in reflecting real market conditions.

Using this Sales Ratio can help assessors understand whether properties are under or overvalued based on recent sales data. It is also a fundamental aspect of maintaining equity in property taxation and ensuring that similar properties are assessed similarly based on their market performance.