Calculators > Financial > Depreciation > Variable Declining Balance

Variable Declining Balance Method Depreciation Calculator
Useful Life (Total Years):
Depreciation Factor (2 is Double):
Year(s) to Calculate:
(ex. 5 or 5-8)
Months in First Year:
Depreciation for Year(s):
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Depreciation Schedule

Example - Cost: $575,000.00, Salvage: $5,000.00, Life: 10 years , First Year: 12 months, Factor: 2

Year
 		 Book Value
Year Start		 Depreciation
% of Book Value		 Depreciation
Expense		 Accumulated
Depreciation		 Book Value
Year End		 Depreciation
Method Used
1 $575,000 20.00% $115,000 $115,000 $460,000 Declining-Balance
2 $460,000 20.00% $92,000 $207,000 $368,000 Declining-Balance
3 $368,000 20.00% $73,600 $280,600 $294,400 Declining-Balance
4 $294,400 20.00% $58,880 $339,480 $235,520 Declining-Balance
5 $235,520 20.00% $47,104 $386,584 $188,416 Declining-Balance
6 $188,416 20.00% $37,683 $424,267 $150,733 Declining-Balance
7 $150,733 24.17% $36,433 $460,700 $114,300 Straight-Line
8 $114,300 24.17% $36,433 $497,134 $77,866 Straight-Line
9 $77,866 24.17% $36,433 $533,567 $41,433 Straight-Line
10 $41,433 24.17% $36,433 $570,000 $5,000 Straight-Line

Variable Declining Balance Depreciation Formulas

The variable declining balance calculation is a combined method of the Declining Balance Depreciation Calculator and the Straight Line Depreciation Calculator. This is a type of calculation allowed under MACRS. The depreciation calculation starts with the declining method.  At the period in the life of the asset where the depreciation calculated by the straight line method on the remaining depreciable amount with be greater than the amount calculated by the declining method, you switch to the straight line method for the remainder of the life of the asset.

  • Declining Balance:
    1. Straight-Line Depreciation Percent = 100% / Useful Life
    2. Depreciation Rate = Depreciation Factor x Straight-Line Depreciation Percent
    3. Depreciation for a Period = Depreciation Rate x Book Value at Beginning of the Period
  • Switching to Straight Line Method:
    1. Depreciation in Any Remaining Period = ((Cost - Accumulated Depreciation) / Remaining Life)

Microsoft® Excel® Functions Equivalent: VDB

The Excel equivalent function for Variable Declining Balance Method is VDB(cost,salvage,life,start_period,end_period,factor,no_switch). With it you can calculate depreciation for the chosen period. "factor" defaults to 2, double declining method, and no_switch defaults to FALSE, meaning it will switch to the straight line method when it is advantageous. To fully depreciate just by the double declining method you can use our Double Declining Balance Method Depreciation Calculator.

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