Predicting D&amp;A in the future

PE

3y

It depends on who I’m building the model for, but generally I would say the most accurate way would be to project Depreciation as a % of prior year PP&E and Amortization as a % of prior year Intangibles

Array

assumingbowl39gmo

Monkey

O

3y

When you say PP&E do you mean gross or net PP&E, or just Change in PP&E for the last year.

TREBITDA

PE

3y

Net PP&E

Array

IB

Analyst 2 in IB - Gen

Anonymous

3y

you can take D&A as a % of sales or make assumptions about the life of the capex and build out a depreciation schedule

Authored by: Certified Private Equity Professional - 2nd Year AssociateCertified Private Equity Pro

assumingbowl39gmo

Monkey

O

3y

I'm new to this so I'm assuming sales means revenue. In regards to making a depreciation schedule, are you saying for example, if capex last year was $3,000,000 and I said the useful life was 10 years and the salvage value was $1,000,000. Depreciation each year would be $200,000?

Rover-S

PE

3y

Indeed, however you would also need to add the depreciation of the capex of previous years.

Authored by: Certified Private Equity Professional - Vice PresidentCertified Private Equity Pro

assumingbowl39gmo

Monkey

O

3y

So because here I said ten years, I would only need to account for the previous 10 years of depreciation of CapEX?

Rover-S

PE

3y

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