how to Calculate Motorcycle Depreciation Valueby Nathaniel Miller
If you are trying to sell or buy a used motorcycle, you are probably interested in the depreciation value of your vehicle of choice. The depreciation value is the value of a motorcycle after a set number of years, and can be determined by a simple formula used by a variety of motorcycle dealers and associations across the nation. Calculating the depreciation value of a motorcycle is not hard and takes only a few minutes.
Begin by determining the salvage value of the motorcycle. You can determined this by taking 15 percent of the Kelly Blue Book value of the motorcycle (see Resources). Also determine the value of the motorcycle when purchased.
Calculate the estimated useful life of the motorcycle by subtracting the number of years since its production from eight (8), the typical lifespan of a motorcycle.
Plug the values into the following formula: Cost of motorcycle -- Salvage Value / Estimated Useful Life = Annual depreciation value. Example: $12,500 - $1,875 / 8 = $1,328 per year.
Multiply the value you calculated in Step 2 by the number of years since you purchased the motorcycle. Then subtract that value from the purchase value of the motorcycle to get the depreciated value. Example: $12,500 - (5 years x $1,328) = $5,860.
- Many websites offer depreciation calculators to aid in determining the current value of your vehicle; however, each insurance agency or motorcycle dealership calculates depreciation a bit differently.