Rehearse method comparison logic in a safe simulator before touching Excel
Before you open Excel, practice the comparison logic here. Pick an asset, predict Year 1 expense for both methods, then see the full side-by-side schedule. This mirrors exactly what your Excel comparison sheet will produce.
Key insight: Both methods depreciate the same total amount (Cost − Salvage). The only difference is timing. DDB expenses more early, SL expenses evenly. Your Excel workbook should show this clearly.
A-001
$30,000
5 years
$5,000
Formula: (Cost − Salvage) / Life
Formula: Cost × (2 / Life)
In Phase 4, you will extend your Lesson 05 asset register workbook by adding a Method Comparison sheet. Here is what you will build:
- Comparison sheet: One row per asset showing SL and DDB Year 1 expense, final book value, and total depreciation
- DDB full schedule: A separate block showing the full DDB schedule with the salvage value floor built in
- Check column: Verifies Book Value = Cost − Accumulated Depreciation for both methods
- Statement impact summary: Shows how method choice changes Year 1 net income and book value
The simulator above produces the same numbers your Excel formulas should. If they do not match, check your formulas.