What Is Salvage Value?

Salvage value (residual value or scrap value) refers to the residual value that can be recovered when an asset expires, that is, the price that can be charged for disposal of the asset when the fixed asset expires. If an asset can be exchanged for a new asset after its expected expiration, then its residual value is equal to the value of the asset expected to be exchanged. [1]

Residual value

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Salvage value (residual value or scrap value) refers to the residual value that can be recovered when an asset expires, that is, the price that can be charged for disposal of the asset when the fixed asset expires. If an asset can be exchanged for a new asset after its expected expiration, then its residual value is equal to the value of the asset expected to be exchanged. [1]
General residual value calculation method: original value of fixed assets × residual value rate
The estimated net residual value rate of fixed assets is usually 3% -5%, which can be adjusted according to specific conditions.

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