Animal Rights Nonprofit owns an office building on which it pays no more than $7,500 each year, including $4,000 for property taxes and $1,500 for maintenance. The nonprofit also records $6,000 for depreciation each year. The Animal Rights Non-Profit sells the building to a third party for $1 million under the condition that the organization could lease back the offices from the third party for $60,000 a year. How much might Animal Rights be able to include as building-related costs, per year, under the federal award it receives?

a. $1,500/year, because only maintenance is an allowable cost.

b. $13,500/year, the amount that it was claiming before the sale and leaseback.

c. $1,000,000, because the grantor will not recognize the ongoing costs.

d. $67,500, because the $6,000 in depreciation is not allowable.