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Excel Depreciation Formula Straight Line - Excel - Excel by hmq31081

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									Instructions for the Microsoft Excel Templates

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                                   Instructions, Page 1 of 4, 2/2/2011, 6:05 PM
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A34 contains the data to be entered. This precludes typing and data entry errors.




                                   Instructions, Page 2 of 4, 2/2/2011, 6:05 PM
Name:
Exercise:         E11-1, Depreciation Computations - SL, SYD, DDB
Course:
Date:
Lansbury Company purchases equipment on January 1, Year 1, at a cost of                $518,000
The asset is expected to have a service life of             12        years and a salvage value of
   $50,000

Instructions:
(a) Compute the amount of depreciation for each Years 1 through 3 using the straight-line
    depreciation method.
Straight-line method depreciation for each of Years 1 through 3 is computed as:

                                          Cost:      Amount
                               Salvage value:        Amount
                           Depreciable value:        Formula
                            Asset life: (Years)      Number
      Annual straight-line depreciation value:       Formula

Excel formula for straight-line depreciation is =SLN(Cost,Salvage,Life)
Area for Excel calculations as desired.

(b) Compute the amount of depreciation for each Years 1 through 3 using the sum-of-years digits
   depreciation method.

The sum of 1 through 12 = 1+2+3+4+5+6+7+8+9+10+11+12 =
                        1+12 + 2+11 + 3+10 + 4+9 + 5+8 + 6+7 =
                        (1+12) + (2+11) + (3+10) + (4+9) + (5+8) + (6+7) =
                        (13) + (13) + (13) + (13) + (13) + (13) =
                        13 X (12/2) =
                        13 X 6 = 78
     the sum of the first year and the last year multiplied by one half of the total number of years.

Hint: Since "Sum-of-Years-Digits" title contains an "S", use salvage value to compute periodic
      depreciation expense.

                                        Cost:        Amount
                              Salvage value:         Amount
                           Depreciable value:        Formula

                                                  Numerator /               Period
                                                    Year      Denominator Depreciation
Depreciation expense for year:         1           Number       Number        Formula
Depreciation expense for year:         2           Number       Number        Formula
Depreciation expense for year:         3           Number       Number        Formula




                                  Exercise 11-1, Page 3 of 4, 2/2/2011, 6:05 PM
The Excel formula for Sum-of-Years-Digits Depreciation is =SYD(Cost,Salvage,Life,Period)

             Depreciation expense for year:        1            Formula
             Depreciation expense for year:        2            Formula
             Depreciation expense for year:        3            Formula

(c) Compute the amount of depreciation for each Years 1 through 3 using the double-declining balance
method. (In performing your calculations, round constant percentage to the nearest one-hundredth of a
point and round answers to the nearest dollar.)

Hint: Since "Double-Declining Balance Method" title does not contain an "S", do not use salvage value
     to compute periodic depreciation expense. However, ensure that book value does not violate
     salvage value.

                                         Cost:    Amount
                              Salvage value:      Amount
                           Asset life: (Years)    Number
      Annual Straight-line Depreciation rate:     Formula
                   Double-Declining factor:         200%
              Double-Declining annual rate:       Formula

                                              Double     Annual
                                 Beginning                                  Ending
                     Year:                   Declining Depreciation
                                  Balance                                   Balance
                                               rate:    Amount:
                       1             Amount Percentage     Formula            Formula
                       2              Value Percentage     Formula            Formula
                       3              Value Percentage     Formula            Formula

The Excel formula for Accelerated Depreciation is =DDB(Cost,Salvage,Life,Period,Factor)
       1                                           Formula
       2                                           Formula
       3                                           Formula
Note: Minor differences may occur due to rounding and significant digits.




                                 Exercise 11-1, Page 4 of 4, 2/2/2011, 6:05 PM

								
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