Depreciation Methods
IntelliTrack Assets contains the most common depreciation methods used in accounting. They include:
- Straight Line
- 150% Declining Balance
- 200% Declining Balance
- Sum of the Years Digits (SYD)
- Manual
Straight Line
Provides for equal year deductions over an asset’s useful life. The system calculates depreciation using the straight line depreciation formula.
Straight Line Formula
Period Depreciation =
(cost - salvage value)/(life)
150% Declining Balance
Provides a greater deduction during the earlier recovery years and the method changes to straight line when it provides an equal or greater deduction. The system calculates depreciation based on the 150% declining balance formula.
150% Declining Balance Formula
Period Depreciation =
[(cost - total depreciation from prior periods) * 1.5]/(life)
200% Declining Balance
Provides a greater deduction during the earlier recovery years and the method changes to straight line when it provides an equal or greater deduction. The system calculates depreciation based on the 200% declining balance formula.
200% (Double) Declining Balance Formula
Period Depreciation =
[(cost - total depreciation from prior periods) * 2]/(life)
Sum of the Years Digits
Provides a deduction based on the assumption that an asset is more productive when it is new and less productive as it ages.
Sum of the Years Digits (SYD) Formula
Period Depreciation =
[(cost - salvage value) * (life - period + 1) * 2] / (life)(life + 1)
Manual
The system does not calculate the asset’s depreciation. Manually enter depreciation information at the Asset form when entering or modifying asset data.