How it works
Straight-line: annual depreciation=(cost−residual)/life. Reducing balance: book=max(residual,cost×(1−rate)^elapsed).
Input definitions
- Asset cost
- Enter the value in the labeled unit.
- Residual/salvage value
- Enter the value in the labeled unit.
- Useful life in whole years
- Enter the value in the labeled unit.
- Whole years elapsed
- Enter the value in the labeled unit.
- Method
- Choose Straight-line / Reducing balance.
- Reducing-balance rate (%)
- Enter the value in the labeled unit.
A worked example
- Asset cost
- 12000
- Residual/salvage value
- 2000
- Useful life in whole years
- 5
- Whole years elapsed
- 2
- Method
- Straight-line
- Reducing-balance rate (%)
- 20
Assumptions & limits
Single-currency planning model using entered rates; two-decimal half-up currency rounding. No taxes, regulatory APR, live quote or investment-return prediction unless explicitly stated.
Sources & review
Maintained by AnsRio. Methods and examples use automated checks; this does not imply independent professional certification.
Method updated 2026-10-17. Content checked against the stated method and examples. Our verification approach.
Common questions
Are these investment and borrowing results guaranteed?
No. These are deterministic estimates from the inputs and stated method, not predicted returns or lending offers. Actual fees, tax, timing and contractual terms may differ.
How does the Asset depreciation and book value tool work?
Straight-line: annual depreciation=(cost−residual)/life. Reducing balance: book=max(residual,cost×(1−rate)^elapsed).
What are the assumptions and limits of Asset depreciation and book value?
Single-currency planning model using entered rates; two-decimal half-up currency rounding. No taxes, regulatory APR, live quote or investment-return prediction unless explicitly stated.