Depreciation Methods.xls

# Depreciation Methods.xls - Year Straight Line Sum of Years...

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Year Straight Line Sum of Years Double Declining Method Digits Balance 1 6000 10000 14000 2 6000 8000 8400 3 6000 6000 5040 4 6000 4000 2560 5 6000 2000 0 Total Amount 30,000 30,000 30,000 Depreciated C acquisiton cost, N is useful life, R residual value, D is the Depreciation Depreciation expense (straight line method)= D= (C-R)x1/N Depreciation expense (Sum of years digit)= D= (C-R) x 1/r where r = 5/15, (1); 4/15 (2); 3/15 (3); 2/15 (4) and 1/15 (5). sum of years digit is 5+4+3+2+1= 15 Depreciation expense (Double declining balance)= D= Book value of as Note two things about thi method; 1) book value or amount thar is depre 2) Total amount of depreciation recognized over the life of the asset

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