## Answers the Question

How much is an item worth, if we assume it loses value very rapidly?

## Calculator for Double Declining Depreciation

## What Is the Double Declining Depreciation?

A full description can be found in the guide to depreciation

## Why Is it Important?

- This method of depreciation allows users to estimate the value of an item and receive a number that is best for tax purposes.

## Formula(s) to Calculate Double Declining Depreciation

- DEPRECIATION PERCENTAGE = 1 - (SCRAP VALUE / PURCHASE PRICE) ^ (1 / LIFESPAN IN YEARS)

## Common Mistakes

- Attempting to discover the depreciation rate independently for each year, rather than just once.
- Using rounded, rather than exact numbers. This leads to increasing error as the years progress.