double declining balance method

However, the depreciation will stop when the asset’s book value is equal to the estimated salvage value. Because twice the straight-line rate is generally used, this method is often referred to as double-declining balance depreciation. To understand the adjusting entries for depreciation, we look back at our example above. This is the table that shows the depreciation account of the balance sheet for 5 years of the asset’s life.

Microsoft® Excel® Functions Equivalent: DDB

  • Whether you’re a business owner, an accounting student, or a financial professional, you’ll find valuable insights and practical tips for mastering this method.
  • The double-declining-balance (DDB)