Depreciation Calculator

Calculate asset depreciation using multiple methods

Depreciation Methods

Depreciation is the systematic allocation of the cost of a tangible asset over its useful life. Different methods are used depending on the asset type and accounting requirements.

Select Depreciation Method

Straight-Line
Declining Balance
Sum-of-Years' Digits
Annual Depreciation = (Cost - Salvage Value) / Useful Life

The straight-line method is the simplest and most commonly used. It allocates equal depreciation expense each year over the asset's useful life.

Annual Depreciation = Book Value × (Depreciation Rate)

The declining balance method applies a constant depreciation rate each year to the declining book value, resulting in higher depreciation in early years.

Annual Depreciation = (Cost - Salvage Value) × (Remaining Life / Sum of Years' Digits)

The sum-of-years' digits method applies a decreasing fraction each year based on the remaining useful life, resulting in accelerated depreciation.

Asset Information

Depreciation Schedule

Total Depreciable Amount: $

Total Depreciation Over Years: $

Year Beginning Value Depreciation Accumulated Depreciation Ending Value

Practical Examples

Example 1: Straight-Line Method

Asset Cost: $10,000 | Salvage Value: $1,000 | Useful Life: 5 years

Annual Depreciation = ($10,000 - $1,000) / 5 = $1,800 per year

Example 2: Double Declining Balance

Asset Cost: $10,000 | Salvage Value: $1,000 | Useful Life: 5 years | Rate: 40% (200%/5)

Year 1: $10,000 × 40% = $4,000 | Year 2: ($10,000 - $4,000) × 40% = $2,400

Example 3: Sum-of-Years' Digits

Asset Cost: $10,000 | Salvage Value: $1,000 | Useful Life: 5 years

Sum of digits = 1+2+3+4+5 = 15 | Year 1: ($10,000 - $1,000) × (5/15) = $3,000

Year 2: ($9,000) × (4/15) = $2,400 | Year 3: ($9,000) × (3/15) = $1,800

Depreciation Method Comparison

Method Advantages Disadvantages Best For
Straight-Line Simple to calculate, equal expenses Doesn't match actual asset use pattern Assets with consistent utility
Declining Balance Matches higher early-year expenses More complex, may not fully depreciate Assets losing value quickly
Sum-of-Years' Digits Accelerated but smoother than DDB More complex calculation Assets with high early productivity