Enter the item age in years, the current replacement cost, and select the item to calculate the actual value of the appliance.

## Appliance Depreciation Formula

The following formula is used to calculate the current value of an appliance that has depreciated over a certain number of years.

CV = RCV – (DR*RCV*AGE)

• Where CV is the current cash value
• RCV is the replacement cash value
• DR is the depreciation rate (%)

## Appliance Depreciation Definition

An appliance depreciation is the loss of value of any appliance due to wear and tear and replacement costs.

## Example Problem

How to calculate appliance value?

For this example, we will be looking at a dishwasher.

First, determine the number of years of use. The dishwasher in this case has been used for 4 years.

Next, determine the replacement cash value. This is the cost of getting a new dishwasher. This is found to be \$1,000.00.

Next, determine the depreciation rate. The average depreciation rate of a dishwasher is 12.40%.

Finally, calculate the value of the depreciated appliance using the formula:

CV = RCV – (DR*RCV*AGE)

= \$1,000.00 – (.124*1,000*4)

= \$504.00.