Machinery and Equipment Valuation Methods
There are three appraisal methods that are considered when valuing a piece of equipment – the Cost Approach, Sales Comparison Approach, and Income Approach.
Although USPAP requires that each of the three approaches to value be considered, the valuation of certain assets or the valuation definition under consideration may make the development and use of all three approaches impractical. The valuation circumstances involving a particular asset may not allow the application and correlation of all three approaches to value. This is consistent with Standards Rule 7-4 of USPAP, which requires the appraiser to consider all three approaches to value and decide which approaches are applicable to the situation at hand.
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