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Depreciation
- Three methods side by side
- Monthly journal entry
- Fixed asset register
Opens in Excel, Google Sheets and Apple Numbers.
Free tools · Fixed assets
Free depreciation calculator: three methods, one year-by-year schedule.
Excello's free depreciation calculator works out each year's depreciation and book value by the straight-line, reducing balance or double-declining method.
Change the numbers and the schedule and chart redraw. The Excel version adds a fixed asset register and the monthly journal entry.
Free. No sign-up. Works on any device.
- Calculator
- Methods three
- Schedule year by year
- Excel included
- Price free
Depreciation calculator online, three methods
The calculator
Enter the asset's cost, the salvage value you expect at the end and its useful life. The chart compares your method with straight-line, year by year.
Straight-line
| Year | Opening | Depreciation | Closing |
|---|---|---|---|
| 1 | $50,000.00 | $20,000.00 | $30,000.00 |
| 2 | $30,000.00 | $12,000.00 | $18,000.00 |
| 3 | $18,000.00 | $7,200.00 | $10,800.00 |
| 4 | $10,800.00 | $4,320.00 | $6,480.00 |
| 5 | $6,480.00 | $1,480.00 | $5,000.00 |
| Total | $45,000.00 |
How to calculate depreciation, method by method
The formulas
Straight-line
(cost − salvage) ÷ useful life
The same amount every year: ($50,000 − $5,000) ÷ 5 = $9,000.
Reducing balance
opening book value × rate
A fixed percentage of what is left. At 30%, year one is $15,000.
Double-declining
opening book value × (2 ÷ life)
For five years the rate is 40%, so year one is $20,000.
| Year | Straight-line | Reducing balance (30%) | Double-declining (40%) |
|---|---|---|---|
| 1 | $9,000.00 | $15,000.00 | $20,000.00 |
| 2 | $9,000.00 | $10,500.00 | $12,000.00 |
| 3 | $9,000.00 | $7,350.00 | $7,200.00 |
| 4 | $9,000.00 | $5,145.00 | $4,320.00 |
| 5 | $9,000.00 | $3,601.50 | $1,480.00 |
| Book value at the end | $5,000.00 | $8,403.50 | $5,000.00 |
Double-declining switches to straight-line on what is left once that gives the larger amount, which is how it lands on the salvage value in the last year. A fourth method, units of production, charges depreciation by use, such as machine hours, in place of years.
Source: IRS Publication 946, How To Depreciate Property (declining balance rate), checked September 2026
Depreciation calculator reducing balance method, and its other names
Reducing balance
The depreciation journal entry
Recording it
Each month, depreciation is recorded with the same two-line entry. The expense goes to the profit and loss statement; the credit builds up against the asset on the balance sheet.
Accumulated depreciation is a contra-asset. After one year, the example equipment shows at $50,000 less $9,000 of accumulated depreciation, a book value of $41,000.
The same depreciation calculator works for a laptop: $1,800 over three years is $50 a month.
| Account | Debit | Credit |
|---|---|---|
| Depreciation expense | $750.00 | |
| Accumulated depreciation, equipment | $750.00 |
Depreciation calculator Excel template, with an asset register
The file
| Asset | Cost | Months used | Accumulated depreciation | Book value |
|---|---|---|---|---|
| Laptop | $1,800.00 | 18 | $900.00 | $900.00 |
| Office furniture | $6,500.00 | 36 | $2,571.43 | $3,928.57 |
| Delivery van | $36,000.00 | 9 | $4,500.00 | $31,500.00 |
| Production equipment | $50,000.00 | 39 | $29,250.00 | $20,750.00 |
| Total | $94,300.00 | $37,221.43 | $57,078.57 |
Figures are illustrative and calculated by the template's own formulas.
Depreciation recorded at every close
Where Excello fits
Frequently asked questions
What is depreciation?
Depreciation spreads the cost of an asset, such as a laptop, vehicle or machine, over the years the business uses it. Each year's share is an expense, and the asset's book value falls by the same amount.
How do you calculate straight-line depreciation?
Subtract the salvage value from the cost and divide by the useful life in years. Equipment costing $50,000 with a $5,000 salvage value and a five-year life depreciates by $9,000 a year.
What is the reducing balance method?
It charges a fixed percentage of the asset's book value each year, so depreciation is highest in the first year and smaller after that. The same method is called diminishing value or written down value.
What is double-declining balance depreciation?
It applies twice the straight-line rate to the opening book value. For a five-year asset that is 40% a year, switching to straight-line once that gives more, so the asset ends at its salvage value.
What is the journal entry for depreciation?
Debit depreciation expense and credit accumulated depreciation. For the example equipment on the straight-line method, that is $750 each month, posted at every month-end close.
How do I depreciate a laptop?
Spread its cost over the number of years you expect to use it. A $1,800 laptop over three years with no salvage value is $600 a year, or $50 a month, on the straight-line method.
Is this depreciation calculator free?
Yes. The calculator on this page and the Excel template are free, with no sign-up needed. The template adds all three schedules side by side, the monthly journal entry and a fixed asset register.