Valuation of Personal Property and Fixtures
Using Assessors’ Handbook Section 581 (Equipment Index, Percent Good, and Valuation Factors)
Appraisal Training: Self-Paced Online Learning Session

Lesson 3: Percent Good Factors


Check Your Knowledge

The exercises below are to be worked by participants to ensure comprehension of information discussed in this lesson.  Additionally, it will help prepare certified property tax appraisers for the final examination that must be taken upon completion of this training session in order to receive appraisal training credit.

Before you start, please print the exercises using the "Print Questions" link below so you can work through the exercises on your own. After you work through the exercises, the solution can be viewed by clicking on the blue plus sign immediately following the question on the right hand side of the page. Additionally, when you have completed all the exercises, you may print all of the solutions using the "Print Questions with Answers" link below.

While all the exercises shown below use lien date 2011 for illustrative purposes, it must be remembered that it is the lien date for which values are sought that determines which AH 581 – and associated factors – will be used.

Note: The RCN, which you calculated in the exercises for Lesson 2, is given for each of the exercises in this lesson (Lesson 3) so that the focus remains on the topic of this lesson – application of percent good factors. Additionally, the average service life of the equipment is also given, when applicable.




Exercise 1

Determine the percent good factor to be used in estimating the reproduction cost new less (normal) depreciation (RCNLD) – market value – of the following types of equipment and fixtures, as of lien date 2011 (January 1).

Image of a table with five columns – row letters, equipment & fixtures, acquisition year, average service life (in years), and percent good factor – and thirteen rows – column headings and a through l.  The table is arranged so that given the type of equipment/fixture – commercial, industrial, construction, new and used mobile construction, agricultural, and harvester and non-harvester mobile agricultural – its acquisition year, and its average service life, the reader is able to compute and fill in the correct percent good factor.

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Exercise 2

What is the reproduction cost new less (normal) depreciation (RCNLD), as of lien date 2011 (January 1), for retail department store equipment purchased and installed in 2006, for $250,000? (The RCN for this equipment is $277,500 and the average service life is 12 years.)

Hint: multiply the RCN by the appropriate percent good factor.

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Exercise 3

What is the reproduction cost new less (normal) depreciation (RCNLD), as of lien date 2011 (January 1), for a forklift purchased and delivered in 2010, for $25,000? (The RCN for this equipment is $25,000 and the average service life is 10 years.)

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Exercise 4

What is the reproduction cost new less (normal) depreciation (RCNLD), as of lien date 2011 (January 1), for furniture manufacturing equipment purchased and installed in 2002, for $250,000? (The RCN for this equipment is $300,000 and the average service life is 15 years.)

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Exercise 5

What is the reproduction cost new less (normal) depreciation (RCNLD), as of lien date 2011 (January 1), for sheet metal manufacturing equipment purchased and installed in 2009, for $750,000? (The RCN for this equipment is $750,000 and the average service life is 15 years.)

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Exercise 6

What is the reproduction cost new less (normal) depreciation (RCNLD), as of lien date 2011 (January 1), for a diesel fired heater (non-mobile construction equipment) purchased and delivered in 2006, for $30,000? (The RCN for this equipment is $32,700 and the average service life is 12 years.)

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Exercise 7

What is the reproduction cost new less (normal) depreciation (RCNLD), as of lien date 2011 (January 1), for dairy farm equipment (non-mobile agricultural equipment) purchased and installed in 2007, for $85,000? (The RCN for this equipment is $93,500 and the average service life is 15 years.)

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Exercise 8

What is the reproduction cost new less (normal) depreciation (RCNLD), as of lien date 2011 (January 1), for an excavator (mobile construction equipment) purchased new and delivered in 2001, for $250,000? (The RCN for this equipment is $320,000.)

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Exercise 9

What is the reproduction cost new less (normal) depreciation (RCNLD), as of lien date 2011 (January 1), for a farm sprayer (mobile agricultural equipment) purchased and delivered in 2003, for $62,500? (The RCN for this equipment is $78,750.)

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