Daily Dose 016 | Engineering Economics
How do you define the depreciation of an asset using MACRS?
Look, I get it, there is a reason we became engineers and not CPAs…we design – they crunch numbers.
But the reality is, to provide the most value to the communities we represent, we must know enough to get dirty in the world of economics.
In this video, we jump in to a problem that is covered within the subject of ENGINEERING ECONOMICS, specifically, diving in to determining the DEPRECIATION on an investment using the method of MODIFIED ACRS (MACRS).
Key Definition
What is MACRS?
The Modified Accelerated Cost Recovery System (MACRS) is a method used for depreciation.
The advantages of MACRS over historical methods are that an asset may be fully depreciated before the end of its service life, a zero salvage value is assumed, and tables given to us in the NCEES Reference Handbook make the system simple to apply.
Check out the video and see how we can go about solving this type of problem in the most efficient manner.
As always, with Love, Prepineer
Video Review
How to define depreciation using MACRS
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