Depreciation Calculator Guide: Formula & Worked Example
Short answer
Straight-line and declining-balance depreciation. In the fixed example below, straight-line / year is 3,600.00. Your answer depends on the inputs and assumptions you choose.
Formula
Result = Depreciation Calculator calculation using asset cost, salvage value, useful life
The inputs are asset cost, salvage value, useful life. Use the input scale shown beside each field and keep time periods and units consistent. Only round the final result for display.
Worked example
- Asset cost
- 20000
- Salvage value
- 2000
- Useful life
- 5
- Straight-line / year: 3,600.00
- Straight-line / month: 300.00
- Double-declining, year 1: 8,000.00
Understanding the result
Straight-line and declining-balance depreciation. Start with the base example, then replace each value with the figure that matches your situation.
Asset cost
The example uses 20000 for asset cost. This is an illustration, not a recommended value. Keep the unit and time period shown by the field.
Salvage value
The example uses 2000 for salvage value. This is an illustration, not a recommended value. Keep the unit and time period shown by the field.
Useful life
The example uses 5 years for useful life. This is an illustration, not a recommended value. Keep the unit and time period shown by the field.
What the comparison means
The comparison changes only asset cost, keeping every other example input fixed. This isolates that input's effect on the primary result. It does not predict future outcomes.
Rates, fees, eligibility, local tax rules and provider rounding can change the final amount. Reference tax and exchange-rate data may be outdated; verify the official source before deciding.
Comparison
| Scenario | Input | Result |
|---|---|---|
| Lower input | Asset cost: 16000 | Straight-line / year: 2,800.00 |
| Base example | Asset cost: 20000 | Straight-line / year: 3,600.00 |
| Higher input | Asset cost: 24000 | Straight-line / year: 4,400.00 |
Common mistakes
- Using the wrong units for asset cost.
- Comparing results while changing more than one input at a time.
- Rates, fees, eligibility, local tax rules and provider rounding can change the final amount. Reference tax and exchange-rate data may be outdated; verify the official source before deciding.
Checklist
- Confirm asset cost.
- Confirm salvage value.
- Confirm useful life is expressed in years.
- Check the result against your source or provider.
Calculators Percentage Editorial Team
Calculator guides from the Calculators Percentage team. These introductory examples are educational, not professional advice.
Last reviewed:
Rates, fees, eligibility, local tax rules and provider rounding can change the final amount. Reference tax and exchange-rate data may be outdated; verify the official source before deciding.