Presentation On

Depreciation
³Written Down Value For Depreciation´ Presented By:Hari Mohan Dwivedi

Written Down value Definition
Diminishing balance method is also known as written down value method or reducing installment method.

A certain percentage is applied to the previous year¶s book value, to arrive at the current year¶s depreciation/ book value,

Conti .. 
Under this method, depreciation is charged at a fixed rate every year, ON THE REDUCING BALANCE.

Formula or equation for the above calculation may be written as follows:

Example First year: 25,000 × 20% = 5000 Second Year: (25000 - 5000) × 20% = 4,000 Third Year: [25000 - (5,000 + 4,000)] × 20% = 3,200