Microsoft Office Tutorials and References
In Depth Information
Depreciating the Finer Things in Life
The example in Figure 6-3 is for an asset put into service in August. Cell
D9 has the formula =DB(\$B\$2,\$B\$3,\$B\$4,B9,5). The fifth argument is
5, which indicates the first year depreciation covers 5 months — August,
September, October, November, and December.
Here’s how to use the DB function to calculate the depreciation for one
period:
1. Enter three values in a worksheet:
•Costofanasset
•Salvagevalue(alwayslessthantheoriginalcost)
•Numberofperiodsinthelifeoftheasset(usuallyanumber
of years)
2. Enter =DB( to begin the function entry.
3. Click the cell that has the original cost, or enter its address.
4. Enter a comma ( ,).
5. Click the cell that has the salvage amount, or enter its address.
6. Enter a comma ( ,).
7. Click the cell that has the number of periods.
8. Enter a comma ( ,).
9. Enter a number for the period for which to calculate the depreciation.
10. Enter a comma ( ,).
11. Enter the number of months within the first year that the depreciation
is applied to.
12. Type a ), and press the Enter key.
The returned value is the amount of depreciation for the entered period. To
calculate the depreciation for the entire set of periods, you need to enter
a formula with the DB function in the same number of cells as there are
periods. However, you should make space for an additional period (refer to
Figure 6-3).
Enter the constant arguments of the function with absolute addressing (the
dollar signs used in front of row numbers or column letters). This makes the
function easy to apply across multiple cells by copying the formula. The
references to the pertinent function arguments stay constant.
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