replacement cost


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Replacement cost

Cost to replace a firm's assets.

Replacement Value

The cost of replacing an asset in the case that it is damaged or destroyed. That is, the replacement value changes according to the market value of the asset. An individual or company may buy a replacement cost insurance policy to cover the replacement value. It is also called the replacement cost.

replacement cost

The current cost of replacing an asset with an equivalent asset.

replacement cost

the cost of replacing a FIXED ASSET (such as an item of machinery) or STOCK. Unlike HISTORIC COST – the original cost of acquiring an asset – replacement cost makes due allowance for the effects of INFLATION in increasing asset prices over time. Prudence requires that stocks are valued in a company's accounts at historic or replacement cost, whichever is the lower. See also REVALUATION PROVISION, INFLATION ACCOUNTING, APPRECIATION, definition 1.

replacement cost

the cost of replacing an ASSET (such as an item of machinery). Unlike HISTORIC COST - the original cost of acquiring an asset - replacement cost makes due allowance for the effects of INFLATION in increasing asset prices over time. See also INFLATION ACCOUNTING, APPRECIATION 2.

replacement cost

(1) In appraisal,the cost to erect a new building substantially similar to the current one. (2) In insurance,the cost to purchase a new item substantially similar to the one damaged, destroyed,or stolen. Contrast with fair market value.

References in periodicals archive ?
The alternative is to insure on an actual cash value basis, which basically is a depreciated replacement cost value.
The fourth and fifth sections, respectively, present the onsite cost results from the replacement cost and productivity change methods.
A replacement cost approach is based on the cost of replacing the services that an individual had previously provided.
Factor 4 shows replacement cost. Accordingly, when using the first two factors in ROI measurement, we see margin in terns of income exclusive of financing questions and turnover based on replacement cost of assets.
While agents should not be responsible for calculating the coverage amount, insuring to 100% of value, offering the replacement cost endorsement and offering extra ordinance or law all are easily within an agent's ability.
That is the lesser of the limits, replacement cost or necessary amount to repair/replace the damaged parts.
With respect to defendant's further contention that replacement cost is unavailable because plaintiffs did not repair or replace the residence within 180 days--which they concededly did not--we agree with Supreme Court that fact questions exist regarding whether Charles Mason, defendant's claims adjustor, directed plaintiffs to leave the premises and their personal property untouched until further notice and, if so, whether they justifiably relied to their detriment on that purported directive (see Fundamental Portfolio Advisors, Inc.
Replacement cost value (RCV) is paid in full if the property is destroyed, in keeping with Florida's Valued Policy Law.
Grange continued to reject the Petersons' claim for replacement costs in excess of $193,000.
In its answer to the first question, the court said that labor to install the new roof was a cost the insured was reasonably likely to incur, which meant it was rightly included within the meaning of replacement cost. It followed, then, that labor could be depreciated along with materials.
2006-14, which provides heavy equipment dealers with a safe-harbor accounting method for using the replacement cost method for valuing heavy equipment parts inventory.
In order to maintain the same level of physical inventory, companies would be compelled to borrow additional money to pay the higher replacement cost. The increased debt loads to finance the higher tax bills and the higher cost of inventory would adversely affect the financial condition and competitiveness of U.S.