Join Curt Frye for an in-depth discussion in this video VDB: Calculating declining balance depreciation for a partial period, part of Excel 2010: Financial Functions in Depth.
The declining balance and adouble declining balance methods let you capture…most of an asset's depreciation early in its economic life.…For a building, which has the useful life of 30 years, these aggressive…depreciation schedules generate huge tax offsets in the first few years.…The downside of this type of schedule is that you get to offset almost no…depreciation toward the end of the asset's economic life.…If you use a variable declining balance approach, you can mix declining…balance and straight-line strategies to capture more of the benefits toward…the end of the asset's life.…
In Excel you use the VDB function to calculate variable declining…balance depreciation.…I've set up this worksheet so that I have all of the data that I need, so I have…the initial cost of the asset. In this case that's $50,000.…Then the salvage value which is the amount for which we can sell this item for scrap.…Then the item's economic life, which is expressed in years, in this case 10.…And then you need to tell Excel the start period and the end period for which…
- Analyzing loans, payments, and interest
- Discovering the interest rate of an annuity
- Determining depreciation using the straight line, declining balance, double-declining balance, and other methods
- Calculating the future value of an investment with variable returns
- Finding the discount rate of a security
- Converting between fractional prices and decimal prices
- Determining the yield of securities that pay interest periodically
Skill Level Intermediate
Managing and Analyzing Data in Excel 2010with Dennis Taylor1h 32m Appropriate for all
Excel 2010: Data Validation in Depthwith Dennis Taylor59m 45s 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. Calculating Prices and Yields of Securities with Odd Periods
Additional resources1m 5s
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