How to calculate machine depreciation per hour

The one-line method

Hourly depreciation = (purchase price - resale value) / expected working hours. A $40,000 VMC resold at $10,000 after 12,000 hours costs $2.50 per running hour - before electricity, maintenance or tooling.

Working hours, not calendar years

Accountants depreciate over years; shops should depreciate over spindle hours, because a machine running 60 hours a week wears out proportionally faster than one running 10. Track hours honestly - your controller already does.

Build the all-in rate

Depreciation + maintenance average + energy + consumables + floor share = the all-in hourly cost this calculator asks for. Most FDM printers land at $1-2.50/hr, hobby CNC at $5-15, production VMCs at $25-60, lasers at $40-90.

Why it matters

Shops that ignore depreciation feel profitable until the machine needs replacing and the money is not there. The hourly rate is how the replacement fund gets filled - by customers, not by you.