What is the actual cash value of the roof that was destroyed in a windstorm?

The actual cash value (ACV) of an asset, such as a roof, is generally calculated as the replacement cost minus depreciation. In the scenario presented, the amount determined to be $2,000 represents the value of the roof at the time of the loss, considering its age and condition. This figure reflects the balance between what it would cost to replace the roof and the depreciation that has occurred due to wear and tear or other factors.

Understanding how other values were determined helps clarify why this specific value is the focus. Higher amounts, such as $3,500 or $5,000, may represent either full replacement costs or more recent valuations that do not account for depreciation, thus making them inaccurate for an ACV determination. The lowest figure, $900, might underrepresent the roof's value even further, suggesting it is either in an overly damaged condition or not reflective of its true asset value before the storm.

Overall, the actual cash value reflects a realistic assessment based on both the cost of replacing the roof and its depreciated condition, with $2,000 being that balanced figure in this situation.