dk

dk*
kBVk
SV
i
R

dk=

depreciation rate
cumulative
depreciation
# of years
book value
salvage value
% reduction of
value
Constant
percentage

( BSV )
N

STRAIGHT LINE METHOD (SLM)

depreciation rate per year (constant value)

dk*=(k)(dk)

accumulated depreciation

BVk=B- dk*

book value

SINKING FUND METHOD (SFM)

i

dk=(B-SV)[ (1+i) N 1 ]

sinking fund factor (constant value)

i (1+i ) 1
dk*=dk[
]
i
BVk=B-dk

accumulated depreciation

book value

DECLINING BALANCE METHOD (DBM)

d1=(B)(R)

depreciation for the first year

dk=B(1-R)k-1(R)

depreciation

dk*=B[1-(1-R)k]
BVk=B(1-R)k

accumulated depreciation
book value