Rental Management 301: Advanced Rental-Module 2: Fleet Management

Module 2: Fleet Management - Part 2

Video Transcription

Video Summary

The video explains the concept of depreciation and net book value in the context of rental fleets. It discusses the depreciation schedule chosen by companies based on the type of equipment and the anticipated holding period. The graph shows the market value of a new machine decreasing each year, while the net book value follows a straight-line depreciation. By keeping the machine for a longer period, companies can maximize their gross profit margin when selling it. The video emphasizes the importance of keeping machines in rental longer to improve overall profitability and gross profit margins on used machines.

Keywords

depreciation

net book value

rental fleets

depreciation schedule

gross profit margin