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Worked-example setupScope and assumptions
- The machine cost, residual value, useful life, estimated productive units, April 1 readiness, calendar-month convention, and method illustrations are supplied.
- Straight-line is the selected book method for the verified schedule; units-of-production and double-declining amounts are comparative teaching views only.
- The work-order evidence stipulates that lubrication maintains ordinary condition and that a separately identified motor replacement renews future service potential.
- The pool illustration is an extension with supplied asset costs, residual values, lives, and valid pool scope.
- Period
- Readiness on April 1 of Year 1; verified straight-line schedule shown after one full equivalent period for typed calculation
- Units
- US dollars, calendar months, years, and productive units
- Rounding
- Expected values use full precision; learner-facing dollars display to cents
Establish the full-period anchor
The $105,000 machine has $5,000 residual value and a five-year life. The verified straight-line amount is $20,000 per full period; after one full equivalent period, accumulated depreciation is $20,000 and carrying amount is $85,000. Those outputs are allocations, not market-value estimates.
Compare patterns without changing the facts
If the same $100,000 depreciable amount relates to 50,000 estimated units, the activity rate is $2 per unit. A 14,000-unit year receives $28,000. A 40% double-declining rate produces $42,000 in the first full year, with later rows controlled so carrying amount does not cross the $5,000 residual floor.
Straight-line, activity, and accelerated schedules change timing. Selection requires service-pattern evidence; the comparison does not authorize the method with the most convenient income effect.
Apply the first partial period
The machine is ready on April 1 and the supplied book policy uses calendar months. First-year straight-line depreciation is $20,000 × 9/12 = $15,000. Payment occurred in January, but cash timing does not start allocation. The calculation uses a book calendar-month convention rather than MACRS.
Route the work orders
Scheduled lubrication preserves ordinary condition and is expensed under the supplied facts. The separately identified replacement motor creates renewed service potential. Linden Peak capitalizes the supported new motor cost, removes the old motor's supported gross and accumulated amounts, and revisits prospective estimates. It does not leave both motors in the register.
Pool extension
For a valid group of similar assets, sum member annual depreciation and divide by total pool cost for the group rate. A composite can contain dissimilar assets. Ordinary pool retirements follow the supported pool policy; the method is not transplanted to the individually tracked replacement above.
Verification boundary
The typed calculation verifies only the full-period straight-line anchor. The partial-period, comparison, component, and pool steps are transparently derived from supplied facts. None proves readiness, service pattern, component identity, residual value, useful life, or pool eligibility.
Verified calculation · straight line depreciation
The curriculum loader recomputed this example before it entered the site build. Expand any structured input to inspect the stated facts.
- cost
- 105,000
- periods elapsed
- 1
- residual value
- 5,000
- useful life periods
- 5
Recomputed result
| Measure | Value |
|---|---|
| accumulated depreciation | 20,000 |
| carrying amount | 85,000 |
| cost | 105,000 |
| depreciable amount | 100,000 |
| depreciation per period | 20,000 |
| remaining depreciable amount | 80,000 |
| residual value | 5,000 |