Calculate asset depreciation, accumulated depreciation, and book value with four common full-year accounting methods.
Calculator
Uses full-year book-depreciation models. It does not apply MACRS classes, tax conventions, Section 179, bonus depreciation, or business-use limits.
Depreciation Results
Review annual expense, accumulated depreciation, book value, and the complete full-year schedule.
Book Value by Year
Selected-Year Details
| Measurement | Value | Calculation note |
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Annual Depreciation Schedule
| Year | Opening book value | Depreciation | Accumulated | Ending book value |
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Calculate asset depreciation and book value
Enter the asset's original cost, expected salvage value, useful life, and the year you want to review. Choose a depreciation method to calculate annual expense, accumulated depreciation, and ending book value. The full schedule lets you compare how quickly each method recognizes the same depreciable cost.
Straight-line depreciation
Straight-line depreciation allocates an equal amount in every full year. Subtract salvage value from cost to find the depreciable basis, then divide by useful life.
annual depreciation = (asset cost - salvage value) / useful life
For a $25,000 asset with a $5,000 salvage value and a five-year life, depreciable basis is $20,000. Straight-line expense is $4,000 each year. After year three, accumulated depreciation is $12,000 and ending book value is $13,000.
Declining-balance depreciation
Declining balance applies a fixed percentage to the asset's opening book value each year. Expense is larger when book value is high and becomes smaller over time. The calculator never reduces book value below the entered salvage value.
annual depreciation = opening book value x annual declining rate
A custom 30% rate on a $25,000 opening value produces $7,500 of first-year depreciation and a $17,500 ending book value. The second-year expense is 30% of $17,500, not 30% of the original cost.
Double-declining-balance method
Double-declining balance uses twice the straight-line rate and applies it to opening book value. For a five-year life, the straight-line rate is 20%, so the double-declining rate is 40%. Salvage value is not subtracted before calculating the first accelerated expense, but it acts as the book-value floor in this calculator.
double-declining rate = 2 / useful life
annual depreciation = opening book value x double-declining rate
Sum-of-years-digits depreciation
Sum-of-years-digits is another accelerated method. Add the useful-life digits to create a denominator, then multiply depreciable basis by a fraction whose numerator declines each year. For a five-year life, the denominator is 5 + 4 + 3 + 2 + 1 = 15.
year expense = (cost - salvage) x remaining-life fraction / sum of years
The year-one fraction is 5/15, year two is 4/15, and year five is 1/15. Unlike declining balance, the schedule allocates the entire depreciable basis to the entered salvage value by the end of useful life.
Cost, salvage value, and useful life
Asset cost is the amount placed into the asset's book basis for this estimate. Salvage value is the expected residual value when useful life ends. Useful life is the number of periods over which the asset is allocated. These are accounting assumptions, not live market-value forecasts. Repairs, impairment, disposal proceeds, changes in estimates, and additional capitalized costs are outside this simplified model.
Book depreciation is not automatically tax depreciation
This calculator uses full-year mathematical schedules for planning and comparison. It does not calculate US federal tax depreciation. The IRS Publication 946 explains that MACRS results depend on the depreciation system, property class, placed-in-service date, recovery period, convention, method, business use, and possible elections. IRS percentage tables can also incorporate partial-year conventions and switches between methods. Use current tax guidance or a qualified tax professional for a return.
Choosing a method
Straight-line is useful when the asset's economic benefit is expected to be relatively even. Accelerated methods recognize more expense early and less later, which may better match assets that lose usefulness quickly. The OpenStax financial accounting guide compares straight-line and double-declining-balance calculations. The appropriate method depends on the accounting framework, asset pattern, policy, and reporting purpose.
Frequently asked questions
What is depreciable basis?
For straight-line and sum-of-years-digits calculations here, depreciable basis is cost minus salvage value.
Can book value fall below salvage value?
No. Every schedule caps depreciation so ending book value is not lower than the entered salvage value.
Why does custom declining balance sometimes end above salvage value?
A percentage applied to a shrinking balance may not fully depreciate the asset during the selected useful life. The schedule shows the remaining book value instead of forcing an unsupported final adjustment.
Does depreciation equal market value loss?
No. Depreciation allocates accounting cost. Market value can move differently because of condition, demand, obsolescence, inflation, and location. Use the car depreciation calculator for a vehicle-value projection rather than a book schedule.