For example, for an asset with an initial cost of $10,000, a useful life of 5 years, and a salvage value of $2,000, depreciation in year 1 can be calculated with SYD as follows: In the worksheet as shown, the formula in C7, copied down, is:

Sum of years calculation

In the example, the asset has a useful life of 5 years. Excel sums the years like this: This sum is then used in the calculation as follows: The asset loses 8000 in value over a 5 year period, so depreciation in period 1 = 5/15 * 8000 = $2,667, depreciation in period 2= 4/15 * 8000 = $2,133 , and so on. The table below summarizes the calculation in all periods.

Dave Bruns

Hi - I’m Dave Bruns, and I run Exceljet with my wife, Lisa. Our goal is to help you work faster in Excel. We create short videos, and clear examples of formulas, functions, pivot tables, conditional formatting, and charts.