Different countries have different methods of calculating depreciation. Excel includes the AMORDEGRC function for use with French accounting rules, which lets you assign a depreciation coefficient based on the economic life of the asset. If you operate under the French system, you’ll probably find the AMORDEGRC function to be useful.
- [Instructor] Different countries have different methods…for calculating depreciation.…Excel includes the A-M-O-R-D-E-G-R-C function…for use with French accounting rules,…which lets you assign a depreciation coefficient…based on the economic life of the asset.…In this movie I will show you how to use that function.…My sample file is DepreciationCoefficient_02_06…and you can find it in the chapter two folder…of your exercise files collection.…The arguments for this function are different…than those traditionally used in the US.…
You do start however with the cost…and that in this case will be 250,000 Euros.…Next is the date of purchase, which is in C4.…Then C5 is the first period.…So this is the accounting period…at which the first depreciation will end.…Salvage value is what you can sell the item for…at the end of its life.…Period is the accounting period…for which we are calculating depreciation.…Rate is something your accountant will need to tell you,…and it's based on French accounting rules…and how quickly you want to deduct deprecation.…
- Recall what the type argument is used to determine when using the PMT function.
- Identify what the M stands for in the ACCRINTM function.
- Name the accounting rules used by the AMORDEGRC function to assign a depreciation coefficient to an asset.
- Recall what internal rate of return generated by the IRR function should be measured against to determine if it is a good investment.
- List the three regular intervals that coupon bonds pay interest at.
- Determine the function that provides a more conservative bond evaluation compared to the DURATION function.
- Explain what the RECEIVED function shows.
Skill Level Intermediate
1. Analyzing Loans, Payments, and Interest
2. Calculating Depreciation
3. Determining Values and Rates of Return
4. Calculating Bond Coupon Dates and Security Durations
5. Calculating Security Prices and Yields
6. Analyzing Simulation Results
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