What's included on the cheat sheet?

1. A list of effective lives for typical items within a property
2. A list of typical replacement costs for typical items within a property
3. Instructions on how to calculate the residual (left over) value

If you’re wanting to calculate the value of the damage, you need three things;

 1. The cost of the item as brand new (e.g. replacing the carpet will cost $3,000)

 2. The effective life of the damaged or destroyed asset (e.g. carpet has an 8 year life)

 3. The age of the damaged item (e.g. the carpet was 6 years old)

From there you can follow the steps;

1. Calculate the percentage of value left: effective life – age = years left. Then divide years left by the effective life (e.g. 8 year life – 6 years old = 2 years left. So, 2 years left of 8 total is 25%.

2. Take the new/replacement value, and multiply by the percentage of value left $3,000 X 25% = $750