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Creating Formulas for Financial Applications 16
Figure 16.15 shows depreciation calculations using the SLN, DB, DDB, and SYD functions. The asset’s original
cost, $10,000, is assumed to have a useful life of 10 years, with a salvage value of $1,000. The range
labeled Depreciation Amount shows the annual depreciation of the asset. The range labeled Value of Asset
shows the asset’s depreciated value over its life.
ON the CD-ROM
This workbook is available on the companion CD-ROM. The file is named depreciation calculations.xlsx.
Figure 16.16 shows a chart that graphs the asset’s value. As you can see, the SLN function produces a
straight line; the other functions produce a curved line because the depreciation is greater in the earlier
years of the asset’s life.
FIGURE 16.15
A comparison of four depreciation functions.
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