Equipment Rate Calc

Equipment Depreciation Calculator

Estimate straight-line value loss, book value, hourly depreciation, and a separate repair allowance for equipment ownership planning. Results update automatically as inputs change.

Inputs

Ownership

Enter the negotiated equipment price before financing; keep separately entered fees and interest out of this value.

Use current trade, auction, or dealer evidence for a comparable machine at the expected age and hours.

Job assumptions

Enter the economic planning life used for this straight-line model, not an assumed tax recovery period.

Use elapsed years since the machine entered service; the model caps age at the entered useful life.

Use realistic annual billed machine hours, excluding idle availability and unpaid transport or service time.

Repair planning

Use repair and wear history for this machine class; keep future replacement savings in the separate replacement-fund model.

Calculations stay in this browser unless you explicitly save or share.

Annual Depreciation 0

How this calculator works

Annual depreciation = (purchase price - expected resale value) / useful life. Hourly depreciation = annual depreciation / annual billable hours.

Read the methodology and editorial policy

Separate value loss from replacement savings

Use this calculator to account for the value a machine gives up while it works, even when there is no monthly payment left.

This tool is best for including machine value loss in cost per hour. It does not decide how much cash to save for the next machine. Review purchase basis, economic life, resale evidence, annual billed hours, and repair history before using the result in an hourly cost.

Worked example

A $65,000 machine with $25,000 expected resale over 6 years loses about $6,667 per year, or $9.52/hour at 700 billable hours.

Use conservative resale value and realistic annual billable hours so paid-off equipment is not priced like it is free. Keep cash planning separate with the Replacement Fund Planning Guide, and test the broader ownership picture in the Total Cost of Ownership Calculator.

Review the ownership assumptions

  • Use depreciation even when there is no loan payment.
  • Review resale value after major hours or damage.
  • Model future replacement cash separately from straight-line value loss.
  • Add a documented repair allowance without counting the same cost twice.

Keep the final scope, assumptions, exclusions, allowances, change triggers, and post-job results with the estimate so future defaults are supported by evidence.

Common questions

Is depreciation the same as a replacement reserve?

No. Depreciation spreads an entered loss in value across a planning period. A replacement reserve estimates the cash needed for a future machine after savings and expected resale; use the separate replacement-fund calculator for that decision.

Does this calculate tax depreciation?

No. This is straight-line economic planning math. Tax basis, recovery periods, elections, and reporting require current records and qualified tax advice.

How should useful life and resale value be chosen?

Use the machine's intended ownership period, expected hours and condition, and current dealer, trade, or auction evidence. Run a range when resale is uncertain.

Important disclaimerPlanning estimate only. Verify current costs, measurements, production, scope, access, customer requirements, contracts, permits, insurance, taxes, and local rules before quoting or committing money. This is not financial, tax, accounting, lending, investment, valuation, depreciation, or legal advice; confirm material decisions with qualified professionals and official records.