Equipment Cost
- purchase expense
- salvage value
- tax savings from depreciation
- major repairs and overhauls
- property taxes
- insurance
- storage
Depreciation can be calculated several ways, the simplest is the straight-line method. The annual depreciation is constant, reducing the equipment value annually. The following are simple equations paraphrased from the Peurifoy & Schexnayder text:
|
m = some year in the future N = equipment useful life (years) and Dn = Annual depreciation amount
Book value (BV) in year m
|
example: N = 5 purchase price = $350,000 m = 3 years from now
|
Read more about this topic: Heavy Equipment (construction)
Famous quotes containing the words equipment and/or cost:
“At the heart of the educational process lies the child. No advances in policy, no acquisition of new equipment have their desired effect unless they are in harmony with the child, unless they are fundamentally acceptable to him.”
—Central Advisory Council for Education. Children and Their Primary Schools (Plowden Report)
“[M]y conception of liberty does not permit an individual citizen or a group of citizens to commit acts of depredation against nature in such a way as to harm their neighbors and especially to harm the future generations of Americans. If many years ago we had had the necessary knowledge, and especially the necessary willingness on the part of the Federal Government, we would have saved a sum, a sum of money which has cost the taxpayers of America two billion dollars.”
—Franklin D. Roosevelt (1882–1945)