The formula to calculate the Residual Value is:
\[ \text{Residual Value} = \left( \frac{\text{Cost of Fixed Asset} - \text{Scrap Rate}}{\text{Lifespan}} \right) \]
Where:
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.
Let's assume the following values:
Using the formula:
\[ \text{Residual Value} = \left( \frac{450 - 10}{315569520} \right) \]
Evaluating:
\[ \text{Residual Value} = 1.3943044943 \times 10^{-6} \]
The Residual Value is approximately 1.3943044943E-06.
| Cost of Fixed Asset | Scrap Rate | Lifespan | Residual Value |
|---|---|---|---|
| 400 | 5 | 315569520 | 0.0000012517 |
| 400 | 10 | 315569520 | 0.0000012359 |
| 400 | 15 | 315569520 | 0.0000012200 |
| 425 | 5 | 315569520 | 0.0000013309 |
| 425 | 10 | 315569520 | 0.0000013151 |
| 425 | 15 | 315569520 | 0.0000012992 |
| 450 | 5 | 315569520 | 0.0000014101 |
| 450 | 10 | 315569520 | 0.0000013943 |
| 450 | 15 | 315569520 | 0.0000013785 |
| 475 | 5 | 315569520 | 0.0000014894 |
| 475 | 10 | 315569520 | 0.0000014735 |
| 475 | 15 | 315569520 | 0.0000014577 |
| 500 | 5 | 315569520 | 0.0000015686 |
| 500 | 10 | 315569520 | 0.0000015527 |
| 500 | 15 | 315569520 | 0.0000015369 |