DDB function in excel is a financial function. It is used to return the depreciation value of an asset during a mentioned period by using double declining balance method or other methods mentioned in Factor argument. It is a worksheet function and can be entered in the cell in which value is required.
=DDB (cost, salvage, life, period, Factor)
- Cost: It is the initial price of the asset.
- Salvage: Value of asset after depreciation.
- Life: It is the period in which asset is depreciated.
- Period: Period for which depreciation will be calculated.
- Factor: It is the rate of depreciation of the balance. Its default value is 2.
- Microsoft Excel stores dates as serial numbers. By default, January 1, 1900 is serial number 1 and corresponding dates have serial number greater than 1.
- The double-declining balance method calculates depreciation at an accelerated rate. DDB function uses the following formulas to calculate depreciation for a period:
Min( (cost – depreciation of prior periods) * (factor/life), (cost – salvage – depreciation of prior periods)
- Factor argument can be used to change the declining rate. Its default rate is 2.
In this example, various arguments are entered in column A and their values are entered in column B , the required depreciation value is entered using formula DDB in column D.