Asset Depreciation Calculator
Calculate annual asset depreciation, accumulated write-offs, and residual book value using Straight-Line, Double Declining Balance (DDB), and Sum-of-the-Years' Digits (SYD) methods.
Asset Parameters
Expected residual value at end of useful life.
Depreciation Summary
| Year | Beginning Book | Depreciation | Accumulated | Ending Book |
|---|
What is Asset Depreciation?
Asset depreciation is the systematic allocation of an asset's tangible cost over its estimated useful economic lifespan in accordance with GAAP and IFRS matching principles. Rather than expensing the full capital expenditure upfront, depreciation matches the operational utility of equipment, vehicles, computers, and buildings against the revenues generated across subsequent financial periods.
Key Depreciation Formulas Explained
1. Straight-Line Method
Uniform deduction each year. Best for steady-use assets.
(Cost - Salvage) / Useful Years
2. Double Declining Balance
Accelerated method. High write-offs early for tax deduction.
Book Value × (2 / Useful Years)
3. Sum-of-the-Years' Digits
Fractional accelerated write-off based on remaining years.
Base × (Remaining Yrs / Sum(Yrs))
Frequently Asked Questions
What is salvage value?
Salvage (or residual) value is the estimated resale price of an asset after its useful life ends. In declining balance depreciation, an asset is never depreciated below its salvage value.
How does MACRS differ from Straight-Line?
MACRS (Modified Accelerated Cost Recovery System) is the official IRS tax depreciation system in the United States, utilizing standardized asset recovery classes (e.g., 3-year, 5-year, 7-year) and half-year convention rules rather than customized salvage values.