H D 1 Depreciation exercise using built-in formulas use the help 2 3 Remember that you can never depreciate if you have a 4 an asset below salvage value. The amount that a company can depreciate is referred to as 5 depreciable cost, and is calculated as cost-salvage value. 6 7 1. Calculate depreciation for years 1-10 for straight-line and double declining balance, using Excel's built-in depreciation functions. 8 2. Calculate accumulated depreciation. Remember that depreciation expense 9 is the current year's depreciation, whereas accumulated depreciation is all the depreciation 10 taken since day 1 (add this year and all prior years' together) 11 3. Cakulate book value. Remember this is what the asset is worth on our books right now, 12 which we calculate as cost minus accumulated depreciation. NOTE: BOOK VALUE CAN NEVER BE BELOW SALVAGE VALUE 13 14 MAKE SURE TO USE THE BUILT-IN FORMULAS. ALSO, WATCH FOR $ SIGNS SO THAT FORMULAS CAN BE COPIED DOWN TO FUTURE YEARS 15 THE $ SIGN IS THE WAY TO TELL EXCEL THAT IT CAN NOT CHANGE A ROW OR COLUMN WHEN COPYING 16 YOU CAN FIND THE BUILT-IN FORMULA BY CLICKING ON THE FORMULA TAB AND LOOKING UNDER FINANCIAL 17 18 You should enter the formulas in the row for year one, and then insert S signs so that the formula can be copied to the remaining years. 19 Make sure to copy down the formulas, do not enter the formulas in individually for the remaining years. 20 21 Instructions: Fill in the chart below showing years 1-10 depreciation for straight line and double declining balance 22 23 Save the file as depreciationbuiltinyour name and submit as an attachment in the dropbox 24 estimated useful life 10 25 Cost 1,200,000 26 Salvage value 200,000 27 28 29 Straight-ling 30 Depreciation Expense Accumulated Depreciation Book Value 31 Period 32 1 33 2 34 3 25 Sheet Sheet2 Sheets F G H D E 26 Salvage value 200.000 27 28 29 Straight-Line 30 Depreciation Expense Accumulated Depreciation Book Value 31 Period 32 1 33 2 34 3 35 4 36 5 37 6 38 7 39 8 40 9 41 10 42 43 Double-Declining Value 44 Depreciation Expense Accumulated Depreciation Book Value 45 Period 46 1 47 2 48 3 49 4 50 5 51 6 52 7 53 8 54 9 55 10 56 57 Save as depreciationbuiltinyour Name 58 Submit the finished assignment in the dropbox where you found the initial file instructions 59