Anatomy of the method comparison workbook: comparison sheet layout, formula patterns, and common traps
Your Lesson 05 asset register has one depreciation method per asset. Today you add a Comparison sheet that shows both straight-line and double-declining balance side by side for every asset. This lets you see the real business impact of your method choice.
The Comparison Sheet Layout
Each row represents one asset from your register. The columns show key numbers for both methods: Year 1 expense, final-year book value, and total depreciation. Both methods must end at the same salvage value.
Formula Patterns You Will Build
- SL annual expense:
(Cost − Salvage) / Life— same every year - DDB rate:
2 / Life— applied to book value at start of each year - DDB expense:
MIN(BookValue × Rate, BookValue − Salvage)— the MIN enforces the salvage floor - Check column:
IF(BookValue = Cost − AccumDep, "OK", "ERROR")— verifies the book value logic
Common Failure Mode: Missing Salvage Floor
The most common DDB error is forgetting to cap the final year's expense. Without the salvage floor, DDB can drive book value below salvage value. In Excel, use MIN(BookValue × Rate, BookValue − Salvage)so the last year's expense never pushes book value too low.
| A | B | C | D | E | F | G | H | ||
|---|---|---|---|---|---|---|---|---|---|
| 1 | A | B | C | D | E | F | G | H | |
| 2 | Method Comparison | ||||||||
| 3 | Row | Asset | Cost | Life | Salvage | SL Yr1 Exp | DDB Yr1 Exp | SL End BV | DDB End BV |
| 4 | 3 | Delivery Van | 30000 | 5 | 5000 | 5000 | 12000 | 5000 | 5000 |
| 5 | 4 | 3D Printer | 15000 | 4 | 1500 | 3375 | 7500 | 1500 | 1500 |
| 6 | 5 | Server Rack | 8000 | 3 | 800 | 2400 | 5333 | 800 | 800 |
| 7 | |||||||||
| 8 | |||||||||
| 9 | |||||||||
| 10 |
- Comparison sheet has one row per asset from the register
- SL and DDB Year 1 expense calculated correctly for each asset
- DDB uses salvage value floor (MIN formula)
- Both methods end at the same salvage value
- Check column verifies Book Value = Cost − Accumulated Depreciation
- Statement impact summary shows expense timing difference