How to Do a Depreciation Worksheet
Depreciation is a non-cash expense used by accountants to track the use of a particular asset over time. It is also used to better match expenses to revenues, which is a common issue in accrual accounting. While there are numerous worksheets to calculate depreciation expense (as there are many methodologies used to calculate depreciation), the variables are usually the same.
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Instructions
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1
Review the calculation for depreciation expense using the straight line depreciation methodology. The straight line depreciation methodology depreciates equal parts over the useful life of the asset. The calculation is "Cost of the Asset" / "Useful Life of Asset."
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2
Determine the useful life of the asset. The useful life is the number of years the asset will be of value. Some assets provide greater value in the earlier years, so you may need to increase the depreciation expense in the earlier years. Some depreciation worksheets will allow you to accelerate depreciation expense but you may need to do it manually for others.
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3
Determine the cost of the asset. The cost of the asset is the amount you paid for the asset. For this example, assume you purchased a $50,000 truck with a useful life of 5 years.
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Input all the variables determined in Steps 2 and 3 into the spaces provided in your worksheet. Some worksheets may ask for additional information and some will ask for less. Choose a worksheet that best suits your needs. The answer is $10,000 for this truck example.
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