depgendb

General declining-balance depreciation schedule

Syntax

Depreciation = depgendb(Cost,Salvage,Life,Factor)

Description

Depreciation = depgendb(Cost,Salvage,Life,Factor) computes the declining-balance depreciation for each period.

Examples

Calculate the Declining-Balance Depreciation

A car is purchased for $10,000 and is to be depreciated over five years. The estimated salvage value is $1000. Using the double-declining-balance method, the function calculates the depreciation for each year and returns the remaining depreciable value at the end of the life of the car.

Define the depreciation.

Life = 5;
Salvage = 0;
Cost = 10000;
Factor=2;

Use depgendb to calculate the depreciation.

Depreciation = depgendb(10000, 1000, 5, 2)

Depreciation = 1×5
103 ×

    4.0000    2.4000    1.4400    0.8640    0.2960

The large value returned at the final year is the sum of the depreciation over the life time and is equal to the difference between the Cost and Salvage. The value of the asset in the final year is computed as (Cost - Salvage) = Sum_Depreciation_Upto_Final_Year.

Input Arguments

Cost — Initial value of the asset

numeric

initial value of the asset, specified as a scalar numeric.

Data Types: double

Salvage — Salvage value of the asset

numeric

Salvage value of the asset, specified as a scalar numeric.

Data Types: double

Life — Number of periods over which the asset is depreciated

numeric

Number of periods over which the asset is depreciated, specified as a scalar numeric.

Data Types: double

Factor — Depreciation factor

numeric

Depreciation factor, specified as a scalar numeric. When Factor = 2, then the double-declining-balance method is used.

Data Types: double

Output Arguments

Depreciation — Depreciation

vector

Depreciation, returned as the declining-balance depreciation for each period.

More About

General Declining-Balance Depreciation Schedule

A general declining-balance depreciation schedule is a method of calculating depreciation that applies a fixed percentage rate to the book value of an asset at the beginning of each period.

This approach results in a decreasing amount of depreciation expense over the asset's useful life, reflecting the declining value of the asset as it ages. It is commonly used for assets that lose value more quickly in their earlier years.

Version History

Introduced before R2006a