Animal Science Project Record Keeping Information
VALUE AND DEPRECIATION
Value – Animals
The value of your animals or livestock is ultimately based on its sale price (or market
price) for an animal of its age and potential. The following is only a general guideline:
A baby may have the potential of great value WHEN it grows up; but infant mortality
rates must be considered. Therefore its worth in the beginning is usually very low. As it grows, it
gains in value. This value may be measured in weight as it approaches marketable age (meat
animal) and the prevailing price of its kind of meat at that time of year; OR, it may be considered
for its potential as a breeding animal and how close it is to approaching breeding age (again, this
is based on what similar animals are being sold for in your area. Sheep/swine, for example, lose
value after prime meat market age and will not increase until it has offspring).
A breeding animal’s value is generally based on the productive part of its lifespan. In
other words, value is based on its usefulness—as a breeder or a work animal, therefore, as it
ages, this value will slowly decline because the number of offspring expected will decrease, or it
is less able to give the same amount of work in a given time as it used to. Pleasure animals' value
may not decline as readily because they may not experience the same physical stress as a breeder
or work animal, but the value of an animal usually does decline as it ages and comes nearer the
end of its usefulness.
Value and Depreciation – Equipment
The amount you pay for a piece of new or used equipment (or what it would have cost if
you had to buy an item that was “gifted” to you) is its cost, and that cost will be the beginning
value for just the first year. The value of the equipment is reduced over its expected life by
depreciating it by a specific amount each year.
A basic formula for figuring equipment depreciation is determined as follows: Figure the
approximate expected life of the item (before it will have to be replaced, by wearing out or being
sold) and divide the cost by the life you have determined (1 year, 5 years, etc.) for the piece of
equipment. Now you have a number that is to be subtracted from that item’s beginning value
each year until the ending value equals zero. (Example: a $3.50 brush may last 5 years. Divide
$3.50 by 5 years and you get 70¢, which you subtract from $3.50, giving you $2.80 as a value for
the end of the year). The ending value for the current year becomes your beginning value of that
item for next year.
If an item looks like it is going to last longer than expected (it is in its last or next-to-last
expected year of life and the item is holding up just fine), DO NOT change the amount you have
been subtracting. Keep subtracting the same amount until the ending value equals zero (this
ensures that you depreciate the correct amount over the asset’s life). Keep listing the item in your
inventory until it is sold or thrown away.
Possible exceptions to the above rule: Saddles may hold or even increase in value based
on market value/availability. If your equipment has precious metal ornamentation, like
gold/silver, its value may very likely increase. When the, item is no longer useful or repairable, it
becomes the value of the precious metal itself. Unique or antique equipment may also increase in
value (based on what someone is willing to pay for that item).