Write steps to compute depreciation using reducing balance method or written down value method or Diminishing balance method in Excel-2007
The following worksheet shows cost, rate of depreciation and life of a machine. Write steps to compute depreciation using reducing balance method in column E. Show WDV in column F.
To compute depreciation using wdv method,
Enter years as 1 to 5 in cells D2 TO D6,
Enter the formula =$B$1*$B$2 in cell E2 and then press enter key.
Enter the formula =$B$1-E2 in cell F2 and then press enter key.
Enter the formula =$B$1-E2 in cell F2 and then press enter key.
Enter the formula =F2*$B$2 in cell E3 and then press enter key.
Enter the formula =$B$1-SUM($E$2:E3) in cell F3 and then press enter key.
Using the fill handle of cell E2 and F3, copy the formula to cells E3 :E6,F4:F6 by dragging the fill handle up to cell E6 and F6.
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