Show All

Hide All

Returns the depreciation of an asset for a specified period using the double-declining balance method or some other method you specify.

Syntax

DDB(cost,salvage,life,period,factor)

Cost   is the initial cost of the asset.

Salvage   is the value at the end of the depreciation (sometimes called the salvage value of the asset). This value can be 0.

Life   is the number of periods over which the asset is being depreciated (sometimes called the useful life of the asset).

Period   is the period for which you want to calculate the depreciation. Period must use the same units as life.

Factor   is the rate at which the balance declines. If factor is omitted, it is assumed to be 2 (the double-declining balance method).

Important  All five arguments must be positive numbers.

Remarks

• The double-declining balance method computes depreciation at an accelerated rate. Depreciation is highest in the first period and decreases in successive periods. DDB uses the following formula to calculate depreciation for a period:

  Min( (cost - total depreciation from prior periods) * (factor/life), (cost - salvage - total depreciation from prior periods) )

• Change factor if you do not want to use the double-declining balance method.
• Use the VDB function if you want to switch to the straight-line depreciation method when depreciation is greater than the declining balance calculation.

Example

The example may be easier to understand if you copy it to a blank worksheet.

Note  The results are rounded to two decimal places.