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Plain-language definitions of key terms used in industrial machinery appraisal, used-equipment sales, and finance.
The price a willing, informed buyer would pay a willing seller in an arm's-length transaction — the standard for most equipment appraisals.
The expected proceeds from selling equipment within a reasonable time frame (typically 6–12 months) with normal marketing — always below FMV.
The price realised at an immediate, time-constrained sale (e.g. auction, receivership). The lowest of the three standard value bases.
The total number of hours a machine's engine or primary drive system has been running since new — the most important depreciation signal for heavy equipment.
A professional designation awarded through the NEBB Institute to appraisers trained in valuing machinery and equipment.
The estimated value of an asset at the end of a lease term or useful life — used in lease pricing and depreciation schedules.
The value of equipment installed and operating as part of a productive business — typically higher than stand-alone FMV because it includes installation and integration value.
The current cost to acquire or produce a new machine with equal utility — the starting point for cost-approach appraisals before depreciation adjustments.
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