# DDB function

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.

• Create a blank workbook or worksheet.
• Select the example in the Help topic.

Note   Do not select the row or column headers.

Selecting an example from Help
• Press CTRL+C.
• In the worksheet, select cell A1, and press CTRL+V.
• To switch between viewing the results and viewing the formulas that return the results, press CTRL+` (grave accent), or on the Formulas tab, in the Formula Auditing group, click the Show Formulas button.
A B
Data Description
2400 Initial cost
300 Salvage value
Formula Description (Result)
=DDB(A2,A3,A4*365,1) First day's depreciation. Microsoft Excel automatically assumes that factor is 2. (1.32)
=DDB(A2,A3,A4*12,1,2) First month's depreciation (40.00)
=DDB(A2,A3,A4,1,2) First year's depreciation (480.00)
=DDB(A2,A3,A4,2,1.5) Second year's depreciation using a factor of 1.5 instead of the double-declining balance method (306.00)
=DDB(A2,A3,A4,10) Tenth year's depreciation. Microsoft Excel automatically assumes that factor is 2 (22.12)

Note   The results are rounded to two decimal places.

Applies to:
Excel 2007