Depreciation Calculator
Depreciation Values
Method = 0
Cost =
Salvage = 0
Life = 1
First Month = 1
Dep Rate = 200
Results
Year = 1
Dep Amount =
Book Value =
Dep Value =
‣ Validations: not available, if(year != ipart(year); "Year must be an integer.";"")
‣ Validations: not available, if(year <= 0 || year > 1000; "Year must be > 0 and <= 1000."; "")
‣ Validations: not available, if(salv < 0 || salv > cost; "Salvage must be >= 0 and <= Cost";"")
‣ Validations: not available, if(rate < 0 || rate >= 10000; "Dep Rate% must be >= 0 and < 10000.";"")
‣ Validations: not available, if(month < 1 || month >= 13;"First Month must be >= 1 and < 13.";"")
‣ Validations: not available, if(method != 1 && life != ipart(life); "Life must be an integer unless method is SL.";"")
‣ Validations: not available, if(life <= 0 || life > 1000; "Life must be > 0 and <= 1000.";"")
‣ Validations: not available, if(cost < 0; "Cost must be >= 0";"")
Help
Calculates depreciation problems using Straight-Line (SL), Sum of the Year's Digits (SOYD), Declining Balance (DB) or Declining Balance Crossover (DB x SL) method.
Rows
Depreciation Values
- Method: Depreciation method. See below for details.
- Cost: Cost to purchase the asset.
- Salvage: Assumed value of the asset at the end of the asset's life.
- Life: Number of years asset will be in service.
- First Month: First month the asset will be placed in service where January is 1 and December is 12. Entering '6.5', for example, means the asset was placed into service half way through the sixth month (approximately June 15).
- Dep Rate%: Declining balance rate. This is used in DB and DB x SL calculations. This is entered as a percentage. For example, 200% declining is entered as '200'.
Results
- Year: Year to calculate depreciation. Because an asset can begin depreciation on a date other than the first of the year, the calendar life may be greater than the amount entered for the asset's Life. For instance, if an asset is expected to have a useful life of 3 years, beginning in March (the third month), the last calendar year is actually the fourth year.
- Dep Amount: Amount of depreciation for the year.
- Book Value: Original cost of the asset less accumulated depreciation. Accumulated depreciation is the total depreciation taken through the calculated year. This is the value of the asset remaining on the company's books.
- Dep Value: Depreciation value. This is the book value less the salvage value for the asset.
Depreciation Method
- Straight-Line (SL): Depreciates the same amount every year of the asset's life.
- Declining Balance (DB): Depreciates more in the first few year's of the assets life than in the later years. This method, along with the DB x SL method, uses the declining balance rate to calculate the depreciation value.
- Declining Balance Cross Straight-Line (DB x SL): Used for tax purposes.In this instance, the declining balance method is used until the optimal time to switch to the straight-line method. The calculator determines this point when depreciation is higher using the straight-line method than the declining balance method. This method also uses the declining balance rate for depreciating.
- Sum of the Year's Digits (SOYD): Like declining balance, allocates more depreciation to the early years of the asset's life. This method uses a complex formula based upon the number of years the asset will be in service to determine a depreciation rate.
Examples
$80,000 worth of equipment was recently purchased in the middle of June. With a five-year useful life and no salvage value, these computers will be depreciated using the declining balance method at a 200% rate. What is the depreciation amount for the first year?
- Method: Declining Balance
- Cost: 80,000
- Salvage: 0
- Life: 5
- First Month: 6.5
- Dep Rate%: 200
- Year: 1
The depreciation amount will be $17,333.33.
Keywords
Method
Cost
Salvage
Life
First Month
Dep Rate
Year
Dep Amount
Book Value
Dep Value
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Straight-Line (SL)
Sum of the Year's Digits (SOYD)
Declining Balance (DB)
Declining Balance Crossover (DB x SL)
