replacement cost

The amount of money required to replace an asset, property, or item with a new one of similar kind and quality at current market prices.

• 🇩🇪Betrag, der aufgewendet werden muss, um einen Vermögenswert, ein Eigentum oder einen Gegenstand durch ein neues Objekt gleicher Art und Güte zu aktuellen Marktpreisen zu ersetzen.

1. Insurance valuation method C1 formal

   The amount of money required to replace an asset with a new one of similar kind and quality at current market prices.

   • The insurance policy covers the replacement cost of the stolen equipment.
   • We calculated the replacement cost of the building after the fire.
   • Replacement cost is often higher than the original purchase price due to inflation.

   🇩🇪Versicherungswertmethode

2. Accounting term C1 formal

   The cost to replace an existing asset with a similar asset at current market prices, used for financial reporting or decision-making.

   • The company estimated the replacement cost of its machinery for the annual report.
   • Replacement cost accounting helps businesses adjust for inflation.
   • They decided to insure the factory at its full replacement cost.

   🇩🇪Wiederbeschaffungskosten