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Depreciation Calculator

Spread the cost of an asset across its useful life and print the full schedule for three standard methods.

Inputs
Depreciation scheduleCalculated
First year depreciation5,400.00 using straight line
Formula
Annual depreciation(cost - salvage) / useful life
Inputs
MethodStraight line
Asset cost30,000.00
Salvage value3,000.00
Useful life5 years
Working
Depreciable base30,000.00 - 3,000.00 = 27,000.00
Each year27,000.00 / 5 = 5,400.00
Schedule
  Year  1   depreciation       5,400.00   accumulated       5,400.00   book value      24,600.00
  Year  2   depreciation       5,400.00   accumulated      10,800.00   book value      19,200.00
  Year  3   depreciation       5,400.00   accumulated      16,200.00   book value      13,800.00
  Year  4   depreciation       5,400.00   accumulated      21,600.00   book value       8,400.00
  Year  5   depreciation       5,400.00   accumulated      27,000.00   book value       3,000.00
Results
  Depreciable base                   27,000.00
  First year charge                  5,400.00
  Total depreciation over the life   27,000.00
  Closing book value                 3,000.00
  Average charge per year            5,400.00
Runs locally in your browser

About the Depreciation Calculator

Depreciation moves the cost of a long lived asset onto the income statement a slice at a time, matching the expense to the years that benefit from it. Only the amount above the salvage value is written off, so a 30,000 machine expected to fetch 3,000 at the end has a depreciable base of 27,000 no matter which method you choose. What changes between methods is the timing.

Straight line divides that base evenly, giving 5,400 a year across five years, and is the default for most reporting because it is simple to audit. Double declining balance applies twice the straight line rate to the falling book value, front loading the charge at 12,000 in year one and tapering to 888 in year five as it stops at the salvage floor. Sum of the years digits sits between the two, weighting each year by how much life remains.

A schedule is printed rather than a single number, showing the charge, the running accumulated total and the closing book value for every year, which is exactly the shape a fixed asset register wants. Tax depreciation often follows a separate statutory table such as MACRS and will not match these figures, so keep the two sets apart. When the asset gains value rather than losing it, the Appreciation Calculator runs the opposite curve, and the charge you produce here feeds the add back in the EBITDA Calculator.

How to use

  1. Pick a method: straight line, double declining or sum of years digits.
  2. Enter the asset cost including delivery and installation.
  3. Enter the salvage value you expect at the end, or zero if the asset will be worthless.
  4. Set the useful life in whole years and read the schedule row by row.

Common questions

What is the straight line depreciation formula?
Annual charge = (cost - salvage value) divided by useful life in years. The same amount is written off every year.
How does double declining balance work?
It applies twice the straight line rate to the opening book value each year, so charges start high and fall. The tool stops the charge once book value reaches salvage.
Which method should a business use?
Straight line suits assets that wear evenly, such as buildings. Accelerated methods suit equipment that loses most of its value early, such as vehicles and computers.
Does this match tax depreciation?
Not necessarily. Tax rules often prescribe their own rates and lives, so many companies keep a separate tax schedule alongside the accounting one.