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Depreciation Calculator

Build a year-by-year depreciation schedule using straight-line, 150% declining-balance, or 200% declining-balance methods, then compare first-year expense, total depreciation, and ending book value.

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Asset Cost Recovery

Depreciation calculator guide: straight-line, declining-balance schedules, and ending book value

A depreciation calculator turns an asset's cost, salvage value, useful life, and chosen method into a year-by-year expense schedule. It helps you compare evenly spread straight-line depreciation with front-loaded declining-balance schedules and see how each method changes first-year expense, accumulated depreciation, and ending book value.

What depreciation is doing

Depreciation allocates the recoverable cost of a business or income-producing asset across the periods that benefit from using it. Instead of expensing the full asset cost immediately, the cost is spread over time according to the method chosen and the useful-life assumption used for the schedule.

That is why depreciation is both an accounting concept and a planning concept. The same asset can produce different year-by-year expense patterns depending on whether you use straight-line or a declining-balance method, even though the total depreciable base recovered over the schedule is the same once salvage value is respected.

Straight-line versus declining-balance

Straight-line depreciation spreads the depreciable base evenly across the useful life. Each year carries the same depreciation expense, which makes the method easy to forecast and explain.

Declining-balance methods apply a higher percentage to the asset's opening book value in earlier years, which produces larger early deductions and smaller later ones. Many schedules switch to straight-line once the remaining straight-line amount becomes larger than the declining-balance amount, because that finishes the depreciable base more efficiently while still respecting the salvage-value floor.

Depreciable base = Asset cost - Salvage value

This is the total amount of cost to be recovered through depreciation across the schedule.

Straight-line annual depreciation = Depreciable base / Useful life

Straight-line spreads the recoverable cost evenly over the full useful life.

Declining-balance depreciation = Opening book value x Rate

The declining-balance rate is commonly based on 150% or 200% of the straight-line rate, subject to the salvage-value floor and any switch to straight-line.

Worked example: comparing the same asset under different methods

Suppose an asset costs 35,000, has a salvage value of 5,000, and a useful life of 5 years. Straight-line depreciation produces a steady 6,000 of annual expense. A 200% declining-balance schedule produces a much larger first-year expense, then smaller later-year amounts as the book value falls.

The calculator shows both the headline first-year expense and the full annual schedule. That helps you compare whether you want a steadier planning view or a more front-loaded depreciation pattern for the same depreciable base.

How to use the schedule

Use the schedule to understand how quickly book value falls, how much depreciation is recognized each year, and when a declining-balance schedule begins to resemble straight-line. It is useful for budgeting, internal planning, and explaining the effect of different methods to stakeholders.

This tool is intentionally simplified. It does not attempt to reproduce every jurisdiction-specific tax convention, recovery class, or mid-period rule. For actual filings or audited statements, compare the result with the tax or accounting rules that govern the asset.

Frequently asked questions

What is the difference between straight-line and declining-balance depreciation?

Straight-line spreads depreciation evenly over the useful life, while declining-balance methods recognize more depreciation in earlier years and less in later years because they apply a fixed rate to the remaining book value.

 Why does salvage value matter?

Salvage value is the floor the schedule should not depreciate below. Depreciation only recovers the asset cost above that expected ending value.

 Why might a declining-balance schedule switch to straight-line?

As the book value falls, the declining-balance amount can become smaller than the remaining straight-line amount. Switching to straight-line at that point can finish the schedule more efficiently while still respecting the salvage-value floor.

 Does this calculator match every tax-depreciation rule?

No. It is a simplified planning tool for straight-line and declining-balance schedules. Actual tax treatment can depend on asset class, recovery system, convention rules, and jurisdiction-specific guidance.

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