salvage value

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Salvage value

Scrap value of plant and equipment.

Residual Value

In accounting, an estimate of the value of an asset at the end of its depreciation. For example, a firm's computer depreciates each year. When it breaks down or becomes obsolete, it has a residual value; it is calculated by the best guess of the net cash inflow when it is sold at the end of its life. It will never be above the blue book value.

In price regulated industries, the residual value may be a negative value because it includes the net cash outflow in removing the asset from where it was used. For example, nuclear energy plants must store the nuclear waste at the end of their useful life. This cost is a contributing factor in the residual value. It is also called the salvage value or scrap value. See also: Absolute Physical Life, Obsolescence.

salvage value

salvage value

see SCRAP.

salvage value

The estimated value a property will have at the end of its useful life. (1) It is an important consideration when demolishing a structure in order to build a new one.Especially with older buildings,architectural components such as molding,trim,doors and hardware,windows,and even antique brick can command a very high price.(2) It was important at one time for income tax depreciation,but there is now a different system in place,the modified cost recovery system,which does not rely upon establishing a salvage value.

Salvage Value

The estimated value that will be realized upon the sale or other disposition of an asset at the end of its useful life.
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