THE PLAYGROUND
An asset across its useful life
Separate the purchase from the expense.
LIVE EXPERIMENT
An asset across its useful life
Asset carrying amount9,000
Before you move a sliderDoes a longer estimated life change the machine’s original cash price?
Annual depreciation = (12000 − 0) / 4 = 3,000
READ THE MECHANISM
Lengthening useful life lowers each year’s expense but does not refund cash or prove the asset is more valuable. The net book amount is allocated cost, not a prediction of resale value.
Model assumptions & units
Straight-line book depreciation, placed in service at the start of year one. No impairment, additions, tax depreciation or partial-year convention. Depreciation stops at residual value.