The residual value is discounted as a single lump sum because it will be received only once at the end of life of the asset.

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The residual value is the estimated value of the asset at the end of its useful life, and it is discounted as a single lump sum because it will only be received once in the future. This is done to bring the future value of the residual value to its present value.

The Residual Value Is Discounted as a Single Lump Sum