Depreciation Calculator
Asset Details
Results
| Annual Depreciation | — |
|---|---|
| Monthly Depreciation | — |
| Accumulated Depreciation | — |
| Book Value | — |
How to Use This Depreciation Calculator
The asset on your books is worth less every year, but how much less depends on the method your accountant picked. Straight-line is predictable; double declining front-loads the expense. I use this when a client asks what their equipment is worth after two years on the floor.
- Enter asset cost and salvage value. Purchase price and estimated residual worth at end of life.
- Enter useful life in years. How long the asset is expected to generate value.
- Select depreciation method. Straight-Line or Double Declining Balance.
- Enter years elapsed. How many years have passed since purchase.
- Press Calculate. Review annual and monthly depreciation, accumulated depreciation, book value, and full schedule.
Compare purchase vs lease cash flow with the Lease Calculator, or model business loan payments for equipment financing with the Business Loan Calculator.
Depreciation Formulas and Practical Applications
Depreciation allocates asset cost over useful life. Book value is what remains on the balance sheet; accumulated depreciation is everything written off so far.
Straight-line
Annual Depreciation = (Cost − Salvage) ÷ Useful Life
A $50,000 asset with $5,000 salvage over 5 years depreciates $9,000/year—$750/month.
Double declining balance
Rate = 2 ÷ Useful Life
Year Depreciation = Book Value × Rate
Year one on that same asset: $50,000 × 40% = $20,000. Depreciation slows as book value falls, stopping at salvage.
Book value after elapsed years
Book Value = Cost − Accumulated Depreciation
After 1 year straight-line, book value is $41,000. After 1 year DDB, it is $30,000.
Frequently Asked Questions
What is straight-line depreciation?
Straight-line spreads equal depreciation each year: cost minus salvage value divided by useful life in years.
What is double declining balance?
Double declining balance applies twice the straight-line rate to the remaining book value each year, stopping when book value reaches salvage.
What is book value?
Book value equals asset cost minus accumulated depreciation at any point in time.
What is salvage value?
Salvage value is the estimated residual worth of the asset at the end of its useful life. Depreciation stops when book value reaches salvage.
Does this match tax depreciation rules?
No. Tax codes may use different methods, bonus depreciation, or Section 179 limits. This tool provides general bookkeeping estimates only.