DB

Using the Excel DB Function

Summary

The Excel DB function returns the depreciation of an asset for a specified period using the fixed-declining balance method. The function considers the initial asset cost, salvage value, the number of periods over which the asset is depreciated and, if desired, the number of months in the first year.

Syntax

=DB (cost, salvage, life, period, [month])

Syntax Breakdown

Cost
Required. Initial cost of the asset.

Salvage
Required. Salvage value of the asset or the value at the end of the depreciation.

Life
Required. The useful life of the asset, or the number of periods over which the asset is being depreciated.

Period
Required. Period for which you want to calculate the depreciation. Must be in the same unit as life.

Month
Optional. Number of months in the first year. If omitted, the argument is assumed to be 12.


Usage Notes

DB uses the fixed-declining balance method to calculate the depreciation of an asset for a specified period. Excel uses the following formula to calculate depreciation for a period:

(Cost - total depreciation from prior periods) * rate

rate = 1 - ((salvage / cost) ^ (1 / life)), rounded to three decimal places

Calculating the depreciation for the first and last period is a special case. For the first period, Excel calculates the depreciation as follows:

Cost * rate * (month / 12)

and the following for the final period

((cost - prior depreciation) * rate * (12 - month)) / 12

Other Depreciation Functions
SYD Function: Sum-of-years depreciation method

SLN Function: Straight-line depreciation method

DDB Function: Double-declining balance depreciation method

VDB Function: Variable declining balance depreciation method