Final answer:
The salvage value of an asset is the residual value. Salvage value refers to the estimated worth of an asset at the end of its useful life or when it is sold.
Step-by-step explanation:
The salvage value of an asset is the residual value.
Salvage value refers to the estimated worth of an asset at the end of its useful life or when it is sold. It represents the amount that can be recovered from the asset after deducting depreciation.
For example, if a company purchases a machine for $10,000 and it has a salvage value of $2,000, it means that the machine is expected to retain a value of $2,000 at the end of its useful life.