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Residual Value Formula

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Residual value is a leasing method, which signifies the future value of an asset in terms of depreciation percentage of the asset's basic value. Check FAQs
RV=C-SRLS
RV - Residual Value?C - Cost of Fixed Asset?SR - Scrap Rate?LS - Lifespan?

Residual Value Example

With values
With units
Only example

Here is how the Residual Value equation looks like with Values.

Here is how the Residual Value equation looks like with Units.

Here is how the Residual Value equation looks like.

1.4E-6Edit=450Edit-10Edit10Edit
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HomeIcon Home » Category Financial » Category Financial Accounting » Category Financial Accounting » fx Residual Value

Residual Value Solution

Follow our step by step solution on how to calculate Residual Value?

FIRST Step Consider the formula
RV=C-SRLS
Next Step Substitute values of Variables
∴ RV=450-1010Year
Next Step Convert Units
∴ RV=450-103.2E+8s
Next Step Prepare to Evaluate
∴ RV=450-103.2E+8
Next Step Evaluate
∴RV=1.3943044942997E-06
LAST Step Rounding Answer
∴RV=1.4E-6

Residual Value Formula Elements

Variables
Residual Value
Residual value is a leasing method, which signifies the future value of an asset in terms of depreciation percentage of the asset's basic value.
Symbol: RV
Measurement: NAUnit: Unitless
Note: Value should be greater than 0.
Formulas to find Residual ValueOpen Variable
Cost of Fixed Asset
Cost of Fixed Asset is the cost of assets and property that cannot easily be converted into cash.
Symbol: C
Measurement: NAUnit: Unitless
Note: Value should be greater than 0.
Formulas to find Cost of Fixed AssetOpen Variable
Scrap Rate
Scrap Rate is the percentage of failed assemblies or material that cannot be repaired or restored and is therefore discarded.
Symbol: SR
Measurement: NAUnit: Unitless
Note: Value should be greater than 0.
Formulas to find Scrap RateOpen Variable
Lifespan
Lifespan is the estimated lifespan of a depreciable fixed asset, during which it can be expected to contribute to company operations.
Symbol: LS
Measurement: TimeUnit: Year
Note: Value should be greater than 0.
Formulas to find LifespanOpen Variable

Other formulas in Basics of Financial Accounting category

​Go Discount Percentage
D%=(LP-SPSP)⋅100
​Go Depletion Charge per Unit
DC=OC-RVnDepletion
​Go Shareholders' Equity given Total Assets and Liabilities
TSE=TA-TL
​Go Shareholders' Equity given Share Capital, Retained Earnings and Treasury Shares
TSE=SC+RE-TS

How to Evaluate Residual Value?

Residual Value evaluator uses Residual Value = (Cost of Fixed Asset-Scrap Rate)/Lifespan to evaluate the Residual Value, Residual value is a leasing method, which signifies the future value of an asset in terms of depreciation percentage of the asset's basic value. Residual Value is denoted by RV symbol.

How to evaluate Residual Value using this online evaluator? To use this online evaluator for Residual Value, enter Cost of Fixed Asset (C), Scrap Rate (SR) & Lifespan (LS) and hit the calculate button.

FAQs on Residual Value

What is the formula to find Residual Value?
The formula of Residual Value is expressed as Residual Value = (Cost of Fixed Asset-Scrap Rate)/Lifespan. Here is an example- 1.4E-6 = (450-10)/315569520.
How to calculate Residual Value?
With Cost of Fixed Asset (C), Scrap Rate (SR) & Lifespan (LS) we can find Residual Value using the formula - Residual Value = (Cost of Fixed Asset-Scrap Rate)/Lifespan.
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