Depreciation plan
A depreciation schedule illustrates the depreciation of an asset over time.
It is usually presented as a table with the columns Period / Year, Depreciation Rate and Net Book Value . Sometimes additional data for the asset to be depreciated is entered; a column for the residual book value at the end of a period is also common.
Example of a depreciation plan
A machine is purchased for € 21,000.00 (net, without sales tax ). With a normal useful life of 7 years and the use of straight-line depreciation, 1/7 of the acquisition costs per year, i.e. € 3,000.00 each, must be calculated as an expense for 7 years. This is represented as follows:
| year | depreciation | Residual book value |
|---|---|---|
| 0 | € 0.0 | € 21,000.00 |
| 1 | 3,000.00 € | € 18,000.00 |
| 2 | 3,000.00 € | € 15,000.00 |
| 3 | 3,000.00 € | € 12,000.00 |
| 4th | 3,000.00 € | € 9,000.00 |
| 5 | 3,000.00 € | € 6,000.00 |
| 6th | 3,000.00 € | 3,000.00 € |
| 7th | 3,000.00 € | € 0.00 |
| total | € 21,000.00 |