when comparing net investment figures stick with the same industry for relevant results 
net investment is therefore a better indicator than gross investment of how much an enterprise is investing in its business since it takes depreciation into account investing an amount equal to the total depreciation in a year is the minimum required to keep the asset base from shrinking this investment amount is known as the maintenance capital expenditure net investment calculationsuppose a company spends 1 million on a new piece of machinery that has an expected life of 30 years and has a residual value of 100 000 based on the straight line method of depreciation annual depreciation would be 30 000 or 1 000 000 100 000 30 therefore assuming no new capital expenditures the amount of net investment at the end of the first year would be 970 000 the formula for calculating net investment is net investment capital expenditures depreciation non cash regular investment in capital assets is critical to an enterprise s continuing success the net investment amount required for a company depends on the sector it operates in sectors such as industrial products goods producers utilities and telecommunications are more capital intensive than sectors such as technology and consumer products that s why when comparing net investment among various companies it is most relevant if they are in the same sector 