WDV and SLM are two different valuation methods used to calculate the value of a company. WDV calculates the present value of all future cash flows, while SLM calculates the depreciation of an asset over its useful life. This blog post will explain the difference between WDV and SLM and how they are used in business valuation.
What is WDV?
WDV is an accounting term that stands for “written down value.” WDV is used to calculate the value of an asset after deducting any depreciation that has been incurred.
The WDV of an asset is important because it can be used to determine the amount of money that a company has invested in the asset and how much the asset is worth.
The WDV can also be used to calculate the amount of money that a company can claim as a deduction for tax purposes. For example, if a company has an asset with a WDV of $1,000 and the asset is sold for $500, the company can claim a $500 deduction for tax purposes.
What is SLM?
SLM is an acronym for “straight line method.” This method is used to depreciate an asset evenly over its useful life. In order to calculate the straight-line depreciation, you must first determine the cost of the asset, the salvage value, and the useful life.
- The salvage value is the estimated resale value of the asset at the end of its useful life and is typically equal to zero. The useful life is the estimated number of years or hours of use for the asset.
- Once you have determined these factors, you can calculate the straight-line depreciation by taking the difference between the cost and salvage value and dividing it by the useful life.
- For example, if a piece of equipment has a cost of $10,000, a salvage value of $0, and a useful life of 10 years, the straight-line depreciation would be $1,000 per year. SLM is just one method that can be used to depreciate an asset; other methods include declining balance and sum-of-the-years’-digits.
Difference between WDV and SLM
WDV and SLM are two methods of depreciation.
- WDV, or Written Down Value, is a method in which the asset is depreciated at a uniform rate over its useful life.
- The WDV of an asset at the end of any particular year is its book value at the beginning of that year minus the amount of depreciation charged for that year.
- SLM, or Straight Line Method, is a method in which the asset is depreciated at a uniform rate over its useful life.
- The SLM of an asset at the end of any particular year is its original cost minus the amount of depreciation charged for that year.
The main difference between WDV and SLM is that WDV takes into account the salvage value of an asset, while SLM does not. WDV is typically used for assets with a longer lifespan, while SLM is typically used for assets with a shorter lifespan.
Conclusion
While WDV and SLM are both effective methods for studying how people read, they have different benefits. WDV is more versatile because it can be used with any type of text, while SLM is better at measuring reading time and eye movements. Both methods have their advantages and disadvantages, so it’s important to choose the right one for your research needs.
