📉 Depreciation Calculator
Calculate yearly depreciation and book value for any asset using straight-line, double-declining balance, sum-of-the-years' digits or units-of-production – and compare the methods side by side.
Quick answer: An asset costing $50,000 with a $5,000 salvage value and a 5-year life depreciates $9,000 a year on the straight-line method; double-declining balance gives $20,000 in year 1 and sum-of-the-years' digits $15,000.
Updated · Free · No sign-up · Works on any device
Depreciation Calculator inputs
Result
Annual depreciation
$9,000.00
Straight-line · $50,000.00 cost, $5,000.00 salvage
| Depreciable base (cost − salvage) | $45,000.00 |
| Total depreciation | $45,000.00 |
| Book value after year 5 | $5,000.00 |
- First-year rate
- 18%
- Straight-line rate
- 20%
Straight-line schedule
| Year | Depreciation | Accumulated | Book value |
|---|---|---|---|
| 1 | $9,000.00 | $9,000.00 | $41,000.00 |
| 2 | $9,000.00 | $18,000.00 | $32,000.00 |
| 3 | $9,000.00 | $27,000.00 | $23,000.00 |
| 4 | $9,000.00 | $36,000.00 | $14,000.00 |
| 5 | $9,000.00 | $45,000.00 | $5,000.00 |
Compare methods
| Year | Straight-line | Double-declining | Sum-of-years' digits |
|---|---|---|---|
| 1 | $9,000.00 | $20,000.00 | $15,000.00 |
| 2 | $9,000.00 | $12,000.00 | $12,000.00 |
| 3 | $9,000.00 | $7,200.00 | $9,000.00 |
| 4 | $9,000.00 | $4,320.00 | $6,000.00 |
| 5 | $9,000.00 | $1,480.00 | $3,000.00 |
How to use the depreciation calculator
Enter the asset's cost, its expected salvage (residual) value and useful life in years, then pick a method. For units of production, also enter the total units the asset should produce and the units used each year. The schedule shows depreciation, accumulated depreciation and book value for each year, and a second table compares the three time-based methods.
Depreciation formulas
Straight-line = (Cost − Salvage) ÷ Life
- Double-declining balance: Book value × 2 ÷ Life, switching to straight-line when larger.
- Sum-of-the-years' digits: (Cost − Salvage) × Remaining life ÷ (n(n+1)/2).
- Units of production: (Cost − Salvage) ÷ Total units × Units used.
Worked example
A $50,000 machine with a $5,000 salvage value and a 5-year life has a depreciable base of $45,000.
| Year | Straight-line | Double-declining | Sum-of-years' digits |
|---|---|---|---|
| 1 | $9,000 | $20,000 | $15,000 |
| 2 | $9,000 | $12,000 | $12,000 |
| 3 | $9,000 | $7,200 | $9,000 |
| 4 | $9,000 | $4,320 | $6,000 |
| 5 | $9,000 | $1,480 | $3,000 |
Every method writes off the same $45,000 in total; accelerated methods simply front-load it. With units of production at 100,000 lifetime units, each unit costs $0.45, so 30,000 units in year 1 means $13,500.
Choosing a method
Straight-line is simplest and most common. Accelerated methods match assets that lose value or usefulness fastest when new, such as vehicles and computers, and lower taxable profit sooner where allowed.
Estimates for educational purposes, not financial advice.
Frequently asked questions
How do you calculate straight-line depreciation?
Subtract the salvage value from the cost and divide by the useful life: ($50,000 − $5,000) ÷ 5 = $9,000 a year.
How does double-declining balance work?
Each year multiply the opening book value by 2 ÷ life (40% for a 5-year asset), without going below salvage. This calculator switches to straight-line once that gives a larger charge, so the asset reaches salvage value exactly at the end of its life.
What is the sum-of-the-years' digits method?
Add the years of life (1+2+3+4+5 = 15). Year 1 depreciation is (cost − salvage) × 5/15, year 2 × 4/15, and so on – an accelerated method that is less aggressive than double-declining balance.
When should I use units of production?
When wear depends on use rather than time – vehicles, machinery or equipment rated in hours or units. Depreciation per unit = (cost − salvage) ÷ total expected units.
Is this the same as tax depreciation?
Not necessarily. These are accounting (book) methods. Tax rules such as US MACRS, Canada's capital cost allowance or UK capital allowances use their own rates and conventions.