Fresh Excel Tips

In this tip, we calculate the depreciation of an investment. To do so, use the SYD function, which returns the sum-of-years’ digits depreciation of an asset for a specified period. Here is the syntax that is used:
SYD(cost, salvage, life, per)
cost: The asset’s initial cost.
salvage: The value of the asset at the end of the deprecation.
life: The number of periods over which the asset is depreciated.
per: The period. per must use the same units as life.

To calculate depreciation:

1. In cell B1 enter the cost of purchase.
2. In cell B2 enter in years the number of periods over which the purchase will be depreciated.
3. Enter the salvage value in cell B3.
4. Calculate the depreciation in the fifth year in cell B5 with the following formula: =SYD($B$1,$B$3,$B$2,5).
5. Press Enter.

SYD is calculated as follows: = ((cost–salvage)*(life–per+1)*2) / (life*(life+1)).

This tip is compatible with Excel 97, 2000, 2003 and 2007.

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