Welcome to Excel Jet Consult blog post. In this tutorial, we want to learn how to use Sum of Years Digit Depreciation function known as SYD Function. Let’s get started
Sum of Years Digits method is an accelerated depreciation that assumes that the productivity of an asset decreases with a period. Sum of Years Digits charges a higher depreciation expense in early years of the useful life of the asset because the asset is significantly productive in early years of its life
SYD Syntax =SYD(cost, salvage, life, per)
In the caption below, we will calculate the depreciation for the three Asset using the Sum of Years Digits function
LAPTOP ASSET DEPRECIATION
The first asset (Laptop) has the following value: Purchased in September 2018 at ₦250,000 price. The Salvage value is ₦70,000 after 10 years in use
Therefore, in cell B13, execute the formula: =SYD($B$3,$C$3,$D$3,B8)
- $B$5 represent the cost of the asset which is ₦250,000
- $C$5 represent the salvage value of the asset which is ₦70,000
- $D$5 represent the life of the asset which is 10 years
- B8 represent the first period
Note, Absolute Cell Reference is applied to all the cell referenced except cell B8. This ensures that when the formula is copied across to June 2019, it doesn’t break.
HOME FURNITURE ASSET DEPRECIATION
In cell B14, execute the formula: = =SYD($B$4,$C$4,$D$4,B8)
Note, Absolute Cell Reference is applied to all the cell referenced except cell B8. This ensures that when the formula is copied across to June 2019, it doesn’t break.
GENERATOR ASSET DEPRECIATION
In cell B15, execute the formula: =SYD($B$5,$C$5,$D$5,B8)
Note, Absolute Cell Reference is applied to all the cell referenced except cell B8. This ensures that when the formula is copied across to June 2019, it doesn’t break.
From the caption below, we can see that the first asset (Laptop) has ₦32,727 as its depreciation value in the first period of the 10 years of asset life. The second and the third assets depreciation value are ₦40,000 and ₦45,455 respectively.
