[VIC] Car Depreciation

[the_trademarc]

Cars will always sell for less than they are bought for (collectables excluded), it's the same with all commodities. People need to stop thinking a car is an asset.

Car is not an asset?? Got onto the Egg-Nog have ya??

 

[Not_An_Abba_Fan]

Do you know what an asset is? An asset earns income. If it doesn't earn you income it is a liability because it costs you money. If you are going for a loan and you own your car, then it is called an asset for the purposes of the loan and equity calculations, but unless it is used to generate income, it is not an asset.

 

[NickyG]

Here is a quote of what an asset is

Any item of economic value owned by an individual or corporation, especially that which could be converted to cash. Examples are cash, securities, accounts receivable, inventory, office equipment, real estate, a car, and other property. On a balance sheet, assets are equal to the sum of liabilities, common stock, preferred stock, and retained earnings. From an accounting perspective, assets are divided into the following categories: current assets (cash and other liquid items), long-term assets (real estate, plant, equipment), prepaid and deferred assets (expenditures for future costs such as insurance, rent, interest), and intangible assets (trademarks, patents, copyrights, goodwill).

but so your thinking 19-20k is what i should be looking at for an omega 09..

 

[wagon_vs]

Do you know what an asset is? An asset earns income. If it doesn't earn you income it is a liability because it costs you money. If you are going for a loan and you own your car, then it is called an asset for the purposes of the loan and equity calculations, but unless it is used to generate income, it is not an asset.

I think you mean an investment. To me an investment is there to earn money, but an asset can be anything that is worth money, but my definitions could well be wrong.

 

[Reaper]

Do you know what an asset is? An asset earns income. If it doesn't earn you income it is a liability because it costs you money. If you are going for a loan and you own your car, then it is called an asset for the purposes of the loan and equity calculations, but unless it is used to generate income, it is not an asset.

Actually an asset is something that could be converted into cash (ie sold). Weather it is appreciating or depreciating is not part of the definition. Nearly all equipment is depreciating in actual raw value. That includes your own house. Assets may be used to assist in earning income whilst their actual value depreciates. Cars are no different as in many cases they are necessary in transporting people to and from their employment. There are many direct and in-direct pieces of equipment used in earning an income.

Reaper

 

[Not_An_Abba_Fan]

That's probably a better definition anyway. I view an asset as something that generates income, if it doesn't generate income then it is a liability as it will never sell for what you bought it for.