May 24th, 2008
Using Microsoft Excel’s Double Declining Balance Depreciation Function
Making financial forecasts or performing investment analyses that needs to include double declining balance depreciation? Microsoft Excel can help. Excel’s DDB, or double declining balance, depreciation function lets you calculate 200% declining balance depreciation.
The DDB function calculates double-declining balance depreciation for an asset given the cost, its salvage value, estimated economic life, the accounting period for which depreciation is being calculated, and, optionally, the factor at which the balance declines. (If you don’t include the optional factor argument, Excel sets this value to 2 indicating “double? declining balance.) The DDB function uses the following syntax:
DDB(cost, salvage, life, period, factor)