What You Need To Know About MDOT Prequalification

The advantage to conducting an equipment appraisal rather than just learning what your equipment straight line depreciation of your assets is that when a piece of equipment has fully depreciated to zero, your piece of equipment still hold value that is not reflected by that straight line of depreciation. An appraisal will more accurately reflect the actual value of your assets and equipment. The accuracy of an appraisal is based in the fact that having an experienced appraisal look at your equipment and assets will allow the value to reach variables and capture areas where a depreciation schedule will not. A straight line depreciation and equipment appraisal both tell the value of an asset or in this case, your piece of equipment – but it’s important to know that although they both tell the value of the asset, each item is very different and has a different concept behind it, as well as can affect your business differently in determining the value of business overall.

Straight Line Depreciation is defined by Investopedia as “the simplest way to work out the loss of value of an asset over time. Straight line basis is calculated by dividing the difference between an asset’s cost and its expected salvage value by the number of years it is expected to be used.” The idea behind a straight line depreciation although it is simple, it is not always accurate in deciding the actual value of your equipment. A piece of equipment or an asset is accurately valued by multiple variables including the hours/miles used, the state of the equipment, the maintenance records, as well as the market around it.