Depreciation Calculator: Straight-Line, Declining-Balance and Sum-of-Years-Digits

How an asset loses book value over its life.

Calculated from standard textbook formulas, with every step shown. The formulas are fixed, so the working does not need checking: what matters is the numbers you type in. Use these calculators only if you are competent to choose the inputs (loads, material strength, dimensions, supports) and check your units and assumptions. For learning and checking your own working: design and sign-off are for a qualified engineer. Drafting Central does not store the numbers you type.

How this calculator works

Enter the cost, the salvage value and the life in years.

Choose the year to report.

The calculator gives the depreciation and the book value for the three methods.

Formulas used

  • D = \frac{C - S}{N}
  • D_t = \frac{2}{N}BV_{t-1}
  • D_t = (C - S)\frac{N - t + 1}{N(N+1)/2}

Worked example

With the default numbers in the calculator above:

  1. Straight-line depreciation each year: 18000.00 dollars
  2. Straight-line book value at the end of the year: 46000.00 dollars
  3. Declining-balance depreciation in the year (rate 2 / life): 14400.00 dollars
  4. Declining-balance book value at the end of the year: 21600.00 dollars
  5. Sum-of-years-digits depreciation in the year: 18000.00 dollars
  6. Sum-of-years-digits book value at the end of the year: 28000.00 dollars

Change the numbers in the calculator to see the full working, every step, for your own case.

A second worked example

A different case, with these numbers: Year to report 5 year.

  1. Straight-line depreciation each year: 18000.00 dollars
  2. Straight-line book value at the end of the year: 10000.00 dollars
  3. Declining-balance depreciation in the year (rate 2 / life): 2960.00 dollars
  4. Declining-balance book value at the end of the year: 10000.00 dollars
  5. Sum-of-years-digits depreciation in the year: 6000.00 dollars
  6. Sum-of-years-digits book value at the end of the year: 10000.00 dollars

Common questions

What is the difference between the methods?

Straight-line takes the same amount each year. Declining-balance and sum-of-years-digits take more in the early years.

What is book value?

The cost minus the depreciation taken so far.

Does this match the tax rules?

Not necessarily. Tax rules set the effective life and the rate, so check the rules of the tax authority.

Related calculators

Got a question about this? Ask an engineering question and get a plain-language answer with references.

Further reading: Any engineering economics or accounting text (depreciation methods).

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