The salvage value formula requires information like purchase price of the machinery, depreciation amount, mode of depreciation, expected life of the machinery etc. to get the actual value of the scrap or the salvage amount of the machinery. Sometimes due to better than expected efficiency level, ...
Salvage Value Formula The formula to calculate the salvage value is as follows. Salvage Value = Purchase Price –(Annual Depreciation × Number of Years) Starting from the original cost of purchase, we must deduct the product of the annual depreciation expense and the number of years. Salvage ...
Knowing the main points of difference between book value and salvage value will help to get a better idea of these two accounting terms.