## What Is a Depreciation Schedule?

The reduction in the value of an asset over multiple years is called Depreciation. A Depreciation Schedule represents the reduction in the asset value or amount over its lifetime. This schedule is used for calculating total yearly depreciation.

**Depreciation Terms:**

**Cost (C):**This is the cost of the asset.**Salvage Value (S**This is the value of the asset at the end of the depreciation period._{n}):**Depreciation Period (n) or Recovery Period:**This is the useful life period of the asset.

## How to Create a Monthly Depreciation Schedule in Excel: 8 Quick Steps

In the following dataset, you can see the Assets, Purchase Date, Actual Cost, Salvage Value, and Depreciations Rate columns.

### Step 1 – Using the Data Validation Tool to Insert Assets in Excel

You can see the outline of the monthly Depreciation schedule with all the necessary terms. We want to insert only one asset name at a time and see the monthly depreciation schedule of that particular asset.

- Select merged cells
**B12:B14**and go to the**Data**tab. - From
**Data****Tools**, select the**Data Validation**group. - Select
**Data Validation**.

- A
**Data Validation**dialog box will appear. - From the
**Allow**group, select**List**.

- Click on the upward arrow of the
**Source**box to select the source cells.

- Select cells
**B5:B7**as the Source cells.

- Click
**OK**in the**Data Validation**dialog box.

- Click on the drop-down arrow of cell
**B12**. This will bring out the asset names. - Select
**Car.**

- Insert the months to show in the monthly depreciation schedule in cells
**C12:C14**.

**Read More: **How to Create Depreciation Schedule in Excel

### Step 2 – Calculating the Return Down Value at the Start of the Month

**WDV** indicates the return down value.

- Use the following formula in cell
**D12**.

`=IFS(B12=B5,D5-E5,B12=B6,D6-E6,B12=B7,D7-E7)`

**Formula Breakdown**

**IFS(B12=B5,D5-E5,B12=B6,D6-E6,B12=B7,D7-E7)**→**the IFS function**finds out whether one or more conditions are met, and then finds out the value of the corresponding True condition.**IFS(B12=B5,D5-E5,B12=B6,D6-E6,B12=B7,D7-E7)**→ becomes output $22,000.- Here, $22,000 is the WDV at Starting of Month of January.

- Press
**Enter**.

Since **January **is the starting month, there will be no Addition During the Year and Deletion During the Year.

- Put
**$0**in cells**E12**and**F12**.

### Step 3 – Evaluating the Current Value of Assets in the Depreciation Schedule

- Use the following formula in cell
**G12**.

`=IFS(B12=B5,D12+E12+E5-F12,B12=B6,D12+E12+E6-F12,B12=B7,D12+E12+E7-F12)`

**Formula Breakdown**

**IFS(B12=B5,D12+E12+E5-F12,B12=B6,D12+E12+E6-F12,B12=B7,D12+E12+E7-F12)**→**the IFS function**finds out whether one or more conditions are met, and then finds out the value of the corresponding True condition.**IFS(B12=B5,D12+E12+E5-F12,B12=B6,D12+E12+E6-F12,B12=B7,D12+E12+E7-F12)**→ becomes**Output:**$30,000

- Explanation: Here, $30,000 is the Current Value of Assets of month January.

- Press
**Enter**.

- Depreciation during the year is 0 for the starting month of
**January**, so we put**$0**in cell**H12**.

### Step 4 – Calculating the Depreciation of Current Value for the First Month

- Use the following formula in cell
**I12**.

`=IFS(B12=B5,D5*F5,B12=B6,D6*F6,B12=B7,D7*F7)`

- Press
**Enter**.

**Read More: **How to Create Vehicle Depreciation Calculator in Excel

### Step 5 – Computing the Total Depreciation in the Monthly Depreciation Schedule

- Use the following formula in cell
**J12**.

`=I12+H12`

- Press
**Enter**. - Put
**$0**in cell**K12**for calculating the value Accumulated Dep. at Starting of the Month.

### Step 6 – Calculating Accumulated at the End of Month

- Use the following formula in cell
**L12**.

`=J12+K12`

- Press
**Enter**.

### Step 7 – Evaluating the Return Down Value at End of Month

- Use the following formula in cell
**M12**.

`=IFS(B$12=B$5,D$5-L12,B$12=B$6,D$6-L12,B$12=B$7,D$7-L12)`

- Press
**Enter**.

### Step 8 – Creating a Depreciation Schedule for the Next Month

The return down value at starting of month **February **is equal to the return down value at the end of the month of **January**.

- In cell
**D13**, use the following formula.

`=M12`

This will input the value of cell **M12** in cell **D13**.

- Press
**Enter**.

- Since Addition During the Year and Deletion During the Year are $0 for the month of
**February**, put**$0**in cells**E13 and F13**.

- Use the following formula in cell
**G13**to calculate the Current Value of Assets for the month of**February**.

`=D13+E13-F13`

- Press
**Enter**.

- Since Dep. During the Year is
**0**for the month of**February,**put**$0**in cell**H13**.

- Since the Dep. of Current Value is the same for the months of January and February, put the following formula in cell
**I13**.

`=I12`

- Press
**Enter**.

- Use the following formula in cell
**J13**.

`=I13+H13`

- Press
**Enter**.

- Since the value of Accumulated Dep. of Starting of the Month for January and February is the same, use the following formula in cell
**K13**.

`=L12`

- Press
**Enter**.

- Use the following formula in cell
**L13**.

`=J13+K13`

- Press
**Enter**.

- To find out the WDV at the End of the Month for February, drag down the formula of cell
**M12**to cell**M13**by the**Fill Handle Tool**.

- This completes the depreciation schedule for February.

- Repeat the process to complete the
**March**row of the depreciation schedule. - You can see the complete monthly depreciation schedule for the asset
**Car**.

- You can see the complete monthly depreciation schedule for asset
**Machinery**.

- You can see the complete monthly depreciation schedule for asset
**Furniture**.

**Read More: **How to Create Rental Property Depreciation Calculator in Excel

## How to Create a Fixed Asset Depreciation Template in Excel

In the following table, you can see the properties of the asset **Car**.

- Here is the outline and months for the fixed asset depreciation template.

### Step 1 – Calculating Depreciation for January

- Use the following formula in cell
**D9**.

`=D5-E5`

- Press
**Enter**. - Put
**$0**in cells**E9**and**F9**.

- Use the following formula in cell
**G9**.

`=IFS(B12=B5,D12+E12+E5-F12,B12=B6,D12+E12+E6-F12,B12=B7,D12+E12+E7-F12)`

- Press
**Enter**.

- Since the Dep. During the Year is
**$0**for the month of**January**, put**$0**in cell**H9**.

- Use the following formula in cell
**I9.**

`=D5*F5`

- Press
**Enter**.

- Use the following formula in cell
**J9**.

`=I9+H9`

- Press
**Enter**.

- Since Accumulated Dep. at Starting of Month is 0 for
**January**, put**$0**in cell**K9**.

- Enter the following formula in cell
**L9**.

`=J9+K9`

** **

- Hit
**Enter.**

- Use the following formula in cell
**M9**.

`=$D$5-L9`

- Press
**Enter**.

### Step 2 – Creating a Depreciation Schedule for February

- Since WDV at End of the Month of January is equal to WDV at Starting of Month of February, in cell
**D13**use the following formula.

`=M9`

- Press
**Enter**.

- Since the Addition During the Year and Deletion During the Year are $0 for the month of February, put $0 in cells
**E10**and**F10**.

- To find out the Current Value of the Asset for the month of February, drag down the formula of cell
**G9**to cell**G10**with a**Fill Handle tool**.

- Since Dep. During the Year for the month of February is 0, put $0 in cell
**H10**.

- Since the value of Dep. of Current Value for January is equal to Dep. of Current Value in February, use the following formula in cell
**I10**.

`=I9`

- Press
**Enter**. - Use the following formula in cell
**J10**.

`=I10+H10`

- Press
**Enter**. - Since the Accumulated Dep. at the start of the Months for January and February are equal, use the following formula in cell
**K10**.

`=L9`

- Press
**Enter**.

- Use the following formula in cell
**L10**.

`=J10+K10`

- Press
**Enter**.

- Use the following formula in cell
**M10**.

`=$D$5-L10`

- Press
**Enter.**

- Similarly, we created the depreciation schedule for the month of March.

**Read More: **How to Create Fixed Asset Depreciation Calculator in Excel

## Practice Section

You can download the Excel file to practice or use it as a template.

**Download the Practice Workbook**

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A Most Excellent Article !

Thank You

Aubrey Meissenheimer

Pretoria, South Africa

Dear

AubreyYou are most welcome. Your appreciation means a lot to us.

Regards

ExcelDemy