Enter the original price, depreciation % per year, and the number of years into the calculator to determine the salvage value. This calculator can also determine the original price, depreciation rate, or asset age given the other variables are known.

Salvage Value Formula

The following formula is used to calculate a salvage value:

SV = OP – (D/100*OP * A)

  • Where SV is the salvage value ($)
  • OP is the original price ($)
  • D is the depreciation per year (%)
  • A is the age of the asset (years)

To calculate a salvage value, divide the depreciation % per year by 100, and multiply that value by the original price and the asset age in years. Take this result and subtract it from the original price to get the salvage value.

Salvage Value Definition

A salvage value is defined as the theoretical price a person could acquire, or “salvage”, for a depreciation asset that they have.

The salvage value is the theoretical price based on the original price and depreciation, but acquiring that value in a sale is much more difficult.

How to calculate salvage value?

Example Problem #1:

In this first example, someone has a dishwasher that they’ve owned for 5 years. Over those 5 years, the dishwasher depreciated an average of 11.5% per year. The dishwasher was originally purchased for $1000.00.

Using the formula above, we can calculate the potential salvage value of the dishwasher.

SV = OP – (D/100*OP*A)

= 1000 – (11.5/100*1000 * 5)

= $425.00.

Example Problem #2:

In this next example, a person has a heater they are looking to sell for close to its salvage value. The heater was originally purchased at $2,000.00, it’s been in use for 4 years, and has depreciated an average of 10% per year.

Using the formula as we did in example 2:

SV = OP – (D/100*OP*A)

= 2000-(10/100*2000*4)