Applications
Note 2: You could have started calculating depreciation at any year within the depreciable life span of the asset. Furthermore, you can skip to any new starting point by simply entering the year number (e.g., year 4), pressing n and then pressing SOD through as many iterations as required to depreciate the asset completely.
Sample Case 1: A fleet car has a value (less salvage value) of $2100 and a life expectancy of six years. Using the sum-of-the-years’ digits method, what is the amount of depreciation and what is the depreciable value for each of the first two years?
Solution
 Enter:  See Displayed:  
 
1 n 6 n 2100 PV   SOD   $
  600.00
  year 1 depreciation
 
x y   $
  1500.00
  remaining value
 
x y SOD   $
  500.00
  year 2 depreciation
 
x y   $
  1000.00
  remaining value
Sample Case 2: Using the values from Sample Case 1, what is the depreciation and depreciable value for years 3 through 6?
Solution
 Enter:  See Displayed:  
 
3 n 6 n 2100 PV   SOD   $
  400.00
  year 3 depreciation
 
x y   $
  600.00
  remaining value
 
x y SOD   $
  300.00
  year 4 depreciation
 
x y   $
  300.00
  remaining value
 
x y SOD   $
  200.00
  year 5 depreciation
 
x y   $
  100.00
  remaining value
 
x y SOD   $
  100.00
  year 6 depreciation
 
x y   $
  0.00
  remaining value

Declining Balance Depreciation

This calculation finds depreciation and remaining book value for each year of an asset’s depreciable life when the present value, salvage value, and life expectancy are known. Declining balance calculations use the storage and recall features of the HP-80. Information is entered as follows:
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