DEPRECIATION (DB) Formula in Excel
Monday, Jun 22
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How to Use the DEPRECIATION (DB) Formula in Excel

DEPRECIATION (DB) Formula in Excel is used to return the depreciation of an asset for a specified period using the fixed-declining balance method.

Formula Explanation

  • Cost (required): The historical cost of the asset.
  • Salvage (required): The value of the asset at the end of the depreciation period (salvage value of the asset).
  • Life (required): The number of periods over which the asset is being depreciated (i.e. this is the useful life of the asset).
  • Period (required): The period for which you want to calculate the depreciation. Periods must use the same units as life. E.g. if you use years for life, you should use years for a period.
  • Month (optional): The number of months in the first year. If the month is omitted, it is assumed to be 12 months.


Johnson & Co. purchase 3 pieces of equipment for its business at the cost, useful life, and salvage values noted below.

Calculate the depreciation per year using the DB formula in Excel.


Using the DB formula in excel, we can calculate the amount of depreciation per year for each of the 3 scenarios using the declining balance method.

Formula Implementations:

  • You cannot actually put a zero in the salvage value syntax as it is going to depreciate the whole amount in year 1.
  • We have to rather estimate a salvage value of $1 at the end of the useful life in order for the formula to take into consideration that the asset should be depreciated over a number of years and not just 1 year.

I hope that helps. Please leave a comment below with any questions or suggestions. For more in-depth Excel training, checkout our Ultimate Excel Training Course here. Thank you!



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