Depreciation Calculator
Calculate annual asset depreciation using straight-line or double-declining balance methods. Get book value and total depreciation.
$
$
years
Year 1 Depreciation
—
Total Depreciation —
Book Value after Year 1 —
How to Use This Calculator
- Enter the Asset Cost — the original purchase price.
- Enter the Salvage Value — its estimated worth at end of life.
- Enter the Useful Life in years.
- Choose the Depreciation Method: straight-line or double-declining balance.
- The calculator shows annual depreciation and book value after year 1.
Formula
Straight-Line: Annual Depreciation = (Cost − Salvage) / Useful Life
Double-Declining: Year 1 Depreciation = Cost × (2 / Useful Life)
Example
Asset cost $50,000, salvage value $5,000, useful life 10 years, straight-line method.
- Annual Depreciation = ($50,000 − $5,000) / 10 = $4,500/year
- Book Value after Year 1 = $50,000 − $4,500 = $45,500
Frequently Asked Questions
- Depreciation is the accounting process of allocating the cost of a tangible asset over its useful life. It reflects the asset's declining value as it is used.
- Straight-line depreciation spreads the depreciable cost evenly over the asset's useful life. Annual Depreciation = (Cost − Salvage Value) / Useful Life.
- DDB is an accelerated method that depreciates the asset faster in early years. The rate is twice the straight-line rate applied to the current book value.
- Salvage value (residual value) is the estimated amount an asset can be sold for at the end of its useful life. It is subtracted from the asset cost to determine the total depreciable amount.
- Straight-line is simpler and common for buildings and furniture. Double-declining is better for assets that lose value faster early on, such as vehicles and computers.