Modern Finance DepreciationDecliningBalance

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DepreciationDecliningBalance

Returns one period's expense as a fixed fraction of the remaining book value.

Syntax

DepreciationDecliningBalance( terms, period )

Examples

#import "std/money"
using money

'' A fixed fraction of the REMAINING book value each period, so the
'' expense falls away geometrically.  RateFactor_ chooses the speed.
dim as DepreciationTerms t = DepreciationTermsMake( DecimalParse( "50000" ).Value( ), _
                                                    DecimalParse( "5000" ).Value( ), 7 )

t.RateFactor_ = DecimalParse( "1.5" ).Value( )        '' 150% declining balance

print DepreciationDecliningBalance( t, 1 ).Value( ).ToStringFixed( 2 )   '' 10714.29
print DepreciationDecliningBalance( t, 2 ).Value( ).ToStringFixed( 2 )   '' 8418.37

'' A slower factor always writes off less early than double declining.
dim as DepreciationTerms fast = DepreciationTermsMake( DecimalParse( "50000" ).Value( ), _
                                                       DecimalParse( "5000" ).Value( ), 7 )
dim as boolean slower = ( DepreciationDecliningBalance( t, 1 ).Value( ) < _
                          DepreciationDoubleDeclining( fast, 1 ).Value( ) )
print slower                             '' true

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Library: Finance
Category: Finance
Documented under: Nothing Becomes A Keyword
Source: pkg/std/money/findeprec.tiko in the tiko repository.