This article describes the formula syntax and usage of the DDB function (function: A prewritten formula that takes a value or values, performs an operation, and returns a value or values. Use functions to simplify and shorten formulas on a worksheet, especially those that perform lengthy or complex calculations.) in Microsoft Excel.
Returns the depreciation of an asset for a specified period using the double-declining balance method or some other method you specify.
DDB(cost, salvage, life, period, [factor])
The DDB function syntax has the following arguments (argument: A value that provides information to an action, an event, a method, a property, a function, or a procedure.):
- Cost Required. The initial cost of the asset.
- Salvage Required. The value at the end of the depreciation (sometimes called the salvage value of the asset). This value can be 0.
- Life Required. The number of periods over which the asset is being depreciated (sometimes called the useful life of the asset).
- Period Required. The period for which you want to calculate the depreciation. Period must use the same units as life.
- Factor Optional. 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.
- 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.
The example may be easier to understand if you copy it to a blank worksheet.
How do I copy an example?
- Select the example in this article. If you are copying the example in Excel Online, copy and paste one cell at a time.
Important: Do not select the row or column headers.
Selecting an example from Help
- Press CTRL+C.
- Create a blank workbook or worksheet.
- In the worksheet, select cell A1, and press CTRL+V. If you are working in Excel Online, repeat copying and pasting for each cell in the example.
Important: For the example to work properly, you must paste it into cell A1 of the worksheet.
- 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.
After you copy the example to a blank worksheet, you can adapt it to suit your needs.
||Lifetime in years
||First day's depreciation. Microsoft Excel automatically assumes that factor is 2. (1.32)
||First month's depreciation (40.00)
||First year's depreciation (480.00)
||Second year's depreciation using a factor of 1.5 instead of the double-declining balance method (306.00)
||Tenth year's depreciation. Microsoft Excel automatically assumes that factor is 2 (22.12)
Note The results are rounded to two decimal places.