Computer Depreciation

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IcemanSA

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I was wondering if there is anyway to determine what a computer will roughly be worth say 12 months from the buying date. If anyone knows where I can read up on such matters please help. Need to do some forward planning for the boss.
 
Hmmm interesting question. Would like to know this too.

And to add I often heard many companies actually purchase computers on a sort of lease agreement to avoid having old and outdated equipment which ends up saving you money in the long run. Is this still done??

Apologies Iceman but it fits the bill with your thread and occured to me now to ask :p

I would think it really depends on your PC as well. A 12 month old celeron won't be worth anything but a 12 month old gaming platform that was state of the art when purchased would maybe still get you a decent return. Also upgradeability is an issue, i.e there have been many changes to sockets on boards of late and as such I highly doubt a 12 month old board can have an upgraded processor put in.
 
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Jonny Two Shoes said:
Hmmm interesting question. Would like to know this too.

And to add I often heard many companies actually purchase computers on a sort of lease agreement to avoid having old and outdated equipment which ends up saving you money in the long run. Is this still done??

Apologies Iceman but it fits the bill with your thread and occured to me now to ask :p

I would think it really depends on your PC as well. A 12 month old celeron won't be worth anything but a 12 month old gaming platform that was state of the art when purchased would maybe still get you a decent return. Also upgradeability is an issue, i.e there have been many changes to sockets on boards of late and as such I highly doubt a 12 month old board can have an upgraded processor put in.
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There is a company called rentworks that does this.
 
jannievdberg said:
According to SA Tax laws, a PC can be written off over a period of 3 years.
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Nod, tax law says 3 years. A cost accountant would tell you the same thing, upgrading faster than that is a waste of money. So for financial decisions and tax implications, go for 3 years. Most companies just sell the PCs for next to nothing, pass it on to employees as a benefit, workstation to complete their work at home or something along those lines.

I think the cheapest possible PC which you can buy brand new in 3 years, would be the maximum return you will get in 3 years if you buy a decent PC today.

I don't think there is a market for 2nd hand PCs over the age of 3 years, because a brand new PC today costs R4400 today, with an LCD, speakers and so forth. People would rather fork out R2000 more than to buy something which will perform 3 times slower. Donate the PCs to charity, deduct it from tax if it has any value left.
 
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I will take the cheapest possible price of a PC in 3 years, the entry level PC, say, R4000, divide that by 3, because technology would be 3 times faster, and use that as the remainder of value. Go to bidorbuy.co.za to see what people are willing to pay for 2nd hand PC parts. I am a financial accountant, need to article still, if your boss likes my answers. :) Completing honors, CIMA this year.
 
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edc said:
I will take the cheapest possible price of a PC in 3 years, the entry level PC, say, R4000, divide that by 3, because technology would be 3 times faster, and use that as the remainder of value. Go to bidorbuy.co.za to see what people are willing to pay for 2nd hand PC parts. I am a financial accountant, need to article still, if your boss likes my answers. :) Completing honors, CIMA this year.
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Something to keep in mind - Moore's Law predicts processing power (the number of number of transistors on a chip) will double every 2 years.

http://www.intel.com/technology/mooreslaw/
 
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That is for CPUs, take the GPU in to account, along with advances in disk and ram technology. Intel and Moore's Law knows much more than I do. :) 2 years then, 1.5 times slower/faster.
 
We get an option at our company to buy our laptops when we upgrade for R500 . Easiest way to get rid of it
 
edc said:
Nod, tax law says 3 years. A cost accountant would tell you the same thing, upgrading faster than that is a waste of money. So for financial decisions and tax implications, go for 3 years. Most companies just sell the PCs for next to nothing, pass it on to employees as a benefit, workstation to complete their work at home or something along those lines.

I think the cheapest possible PC which you can buy brand new in 3 years, would be the maximum return you will get in 3 years if you buy a decent PC today.

I don't think there is a market for 2nd hand PCs over the age of 3 years, because a brand new PC today costs R4400 today, with an LCD, speakers and so forth. People would rather fork out R2000 more than to buy something which will perform 3 times slower. Donate the PCs to charity, deduct it from tax if it has any value left.
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Any asset that was bought for less then R5000 can be depriciated in one year.
This includes PC
 
Icko said:
Any asset that was bought for less then R5000 can be depriciated in one year.
This includes PC
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We always used 3 years in tax, which I completed least year, have not articled yet though.
 
Jonny Two Shoes said:
And to add I often heard many companies actually purchase computers on a sort of lease agreement to avoid having old and outdated equipment which ends up saving you money in the long run. Is this still done??
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It is, the Cape Tech (CPUT) get their PC's like this, probably others too. I'm not sure just how cheap it works out, maybe it's more about saving the hassle of trying to sell thousnads of old PC's to the public when you upgrade.

That alone would make renting worthwhile.
 
At the moment if you can manage to buy wholesale and sell at same price within six months you should be able to stick with latest tech at relatively low cost. :)
 
never antowan, in six months your pc is worth half or less than you paid even if you bought direct

in six month amd's new cpu's will be out, you really think your old conroe will sell well
 
well i dont know if the original post was about a business pc... depending on the specs of what you are buying, i would roughly work out that you would get, at the most , 50% of the original purchase price after 1yr on a new pc.
y? most components sold have a 1yr warranty... which by the time you sell it, is over. so... NO GUARANTEES, which is the issue when you buy secondhand equipment, no peace of mind.
and most decidingly... people look for bargains, so if it isnt considered cheap then you might have to hold out for a buyer.
 
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