what is residual value 
residual value refers to what an asset is worth after it has been fully depreciated for accounting purposes the item may still be saleable to another buyer in which case the seller will recoup some of the item s expected lifetime cost a car for example may still have some resale or trade in value even if you ve driven it for quite a few years the bottom linelifetime cost is a useful way to estimate how much a particular item will cost to own and can be especially important in high ticket purchasing decisions 