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what is the formula for depreciation. Rate of depreciation on original cost. Useful life of asset represents the number of periodsyears in which the asset is expected to be used by the company.
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The formula to calculate MACRS Depreciation is as follows. The first-year depreciation calculation is. Depreciation Expense Remaining life Sum of the years digits x Cost Salvage value Consider the following example to more easily understand the concept of the sum-of-the-years-digits depreciation method.
Useful life of asset represents the number of periodsyears in which the asset is expected to be used by the company.
Rate of depreciation on original cost. The next years calculation is based on the previous years total. It is the initial book value of the asset. Each year use the prior years adjusted cost for that years calculation.
