Depreciation Methods
Purchase Cost: $ 10,000.00
Salvage Value: $ 2,000.00
Useful Life: 5 years
Straight-Line Depreciation Sum-of-Years Depreciation
Year Depreciation SLN Value Year Depreciation SYD
0 $ 10,000.00 0
1 $ 1,600.00 $1,600.00 $ 8,400.00 1 $ 2,666.67 $2,666.67
2 $ 1,600.00 $1,600.00 $ 6,800.00 2 $ 2,133.33 $2,133.33
3 $ 1,600.00 $1,600.00 $ 5,200.00 3 $ 1,600.00 $1,600.00
4 $ 1,600.00 $1,600.00 $ 3,600.00 4 $ 1,066.67 $1,066.67
5 $ 1,600.00 $1,600.00 $ 2,000.00 5 $ 533.33 $533.33
Double Declining Balance
Double Declining Balance
Year Depreciation Value
$12,000
0 $ 10,000.00
1 $ 4,000.00 $ 6,000.00 $10,000 Traditional Double Declini
2 $ 2,400.00 $ 3,600.00 Balance Method
3 $ 1,440.00 $ 2,160.00 $8,000 Excel DDB Function
4 $ 864.00 $ 1,296.00
Value
5 $ 518.40 $ 777.60 $6,000
Year DDB Value $4,000
0 $ 10,000.00
$2,000
1 $4,000.00 $ 6,000.00
2 $2,400.00 $ 3,600.00 $-
3 $1,440.00 $ 2,160.00 0 1 2 3 4 5
4 $160.00 $ 2,000.00 Time (years)
5 $0.00 $ 2,000.00
Units of Production Method
Useful Life: 5000 units
Units of Production M
Example A $12,000
$10,000
Year Units Prod. Depreciation Value
0 $ 10,000.00
$8,000
1 1200 $ 1,920.00 $ 8,080.00
2 500 $ 800.00 $ 7,280.00
Value
$6,000
3 1800 $ 2,880.00 $ 4,400.00
4 300 $ 480.00 $ 3,920.00
$4,000
$2,000
$8,000
Value
$6,000
$4,000
5 1100 $ 1,760.00 $ 2,160.00
$2,000
Example B
$-
Year Units Prod. Depreciation Value 0 1 2 3
0 $ 10,000.00 Time (years)
1 200 $ 320.00 $ 9,680.00
2 300 $ 480.00 $ 9,200.00
3 500 $ 800.00 $ 8,400.00
4 1000 $ 1,600.00 $ 6,800.00
5 2000 $ 3,200.00 $ 3,600.00
Straight-Line Depreciation
$12,000
Sum-of-Years Depreciation
$10,000
Value
$8,000
$ 10,000.00
$ 7,333.33
Value
$6,000
$ 5,200.00
$ 3,600.00
$4,000
$ 2,533.33
$ 2,000.00
$2,000
$0
0 1 2 Time (year)
3 4 5 6
ning Balance
Traditional Double Declining
Balance Method
Excel DDB Function
3 4 5 6
years)
Units of Production Method
Example A
Example B
1 2 3 4 5 6
Time (years)
