Depreciation Calculator

Estimate how an asset’s book value changes over its useful life using straight-line, declining balance, or sum-of-years-digits depreciation. The calculator uses asset cost, salvage value, useful life, method, and optional declining-balance rate.

How to use this calculator

Choose the depreciation method, then enter asset cost, salvage value, and useful life in years. For declining balance, use double-declining or enter a custom rate. The output shows total depreciation, ending book value, and a yearly schedule. For vehicle-specific value changes, compare with the auto loan calculator when planning ownership cost.

Formula

Straight-line depreciation spreads depreciable cost evenly:

$annual\ depreciation = (asset\ cost - salvage\ value) \div useful\ life$

Sum-of-years uses a larger fraction in early years. Declining balance applies a rate to beginning book value and switches when needed to avoid dropping below salvage value.

Example

For a 10,000 dollar asset, 1,000 dollar salvage value, and five year useful life, straight-line depreciation is 1,800 dollars per year. After year one, book value is 8,200 dollars.

Interpreting results

Accelerated methods recognize more depreciation earlier, while straight-line is even across years. Accounting rules, tax rules, bonus depreciation, and partial-year conventions can differ from this educational schedule. For replacement planning, include the result in a budget calculator or savings goal calculator.