Example: Computing Straight-Line Depreciation

In mid-March, a company begins depreciation of a commercial building with a 31½ year life and no salvage value. The building cost $1,000,000. Use the straight-line depreciation method to compute the depreciation expense, remaining book value, and remaining depreciable value for the first two years.

To	Press	Display
Access Depreciation worksheet	& p	SL
Enter life in years	# 31.5 !	LIF =	31.501
Enter starting month	# 3.5 !	M01 =	3.501
Enter cost	# 1000000 !	CST =	1,000,000.001
Leave salvage value as is	#	SAL =	0.00
Leave year as is	#	YR =	1.00
Display depreciation amount, remaining book value, and remaining depreciable value	# # #	DEP = RBV = RDV =	25,132.28* 974,867.72* 974,867.72*
View second year	# & !	YR = YR =	1.00 2.001
Display second year depreciation data	# # #	DEP = RBV = RDV =	31,746.03* 943,121.69* 943,121.69*

Answer: For the first year, the depreciation amount is $25,132.28, the remaining book value is $974,867.72, and the remaining depreciable value is $974,867.72.

For the second year, the depreciation amount is $31,746.03, the remaining book value is $943,121.69, and the remaining depreciable value is $943,121.69.