# How to Create Vehicle Depreciation Calculator in Excel

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The reduction in the value of an asset over multiple numbers of years is called Depreciation. A business organization purchases assets for its own purpose, The assets may be objective (i.e. products) or abstractive (i.e. services). It uses the purchased assets for several years. After the usual years, the asset value doesn’t remain the same. It decreases with the depreciation rate. In this article, I will explain 3 smart and effective ways to create a vehicle depreciation calculator in Excel. I hope it will be helpful for you if you are looking for a similar sort of thing in Microsoft Excel.

## 3 Smart Ways to Create a Vehicle Depreciation Calculator in Excel

There are 3 smart ways that we can use to create a vehicle depreciation calculator in Excel. They are described in the following section.

### 1. Apply Straight Line Method

We can apply the Straight Line method to create a vehicle depreciation calculator in Excel. In this method, the depreciation value is the ratio of the difference between the asset value and the asset’s residual cost, and the lifespan of that asset.

For more simplification, I have used a dataset of a company’s information about vehicles. I have organised the data in Particulars and Value. Steps:

• Select a cell (i.e. C10) and input the following formula.
`=(C6-C8)/C7` • Press ENTER to have the vehicle depreciation. ### 2. Employ Use of Activity Depreciation Method

There is another method named Use of Activity Depreciation that we can use to create vehicle depreciation calculator. In this case, the depreciation value is the multiplication value of the yearly production unit and the ratio of the difference between the asset value and the asset’s residual cost, and the total production unit of the asset’s lifespan.

Steps:

• First of all, pick a cell (i.e. C14) and input the following formula in that cell to have the depreciation for the first year.
`=((C6-C8)/C9)*C10` • Press ENTER to have the output. • Similarly, write the following formula and press ENTER to have the depreciation for the second year.
`=((C6-C8)/C9)*C11` ### 3. Utilize Double Declining Balance Method

Another simple and effective method to have vehicle depreciation calculation is the double declining balance method. According to this method, the depreciation value is the ratio of 2 times the difference between the asset value and the asset’s residual cost and the lifespan of that asset.

Steps:

• Select a cell (i.e. C14) and input the following formula in that cell to have the depreciation for the first year.
`=(2*(C6-0))/C7` • Now, hit ENTER to have the output. • Similarly, apply the following formula and press ENTER to have the depreciation for the second year.
`=(2*(C6-C12))/C7` ## Conclusion

At the end of this article, I like to add that I have tried to explain 3 smart and effective ways to create a vehicle depreciation calculator in Excel. It will be a matter of great pleasure for me if this article could help any Excel user even a little. For any further queries, comment below. You can visit our site for more articles about using Excel.

## Related Articles Naimul Hasan Arif

Hello, I am Arif. I am an Engineer who graduated from BUET. I want to pursue an enterprising career in a progressive environment where my skills & knowledge can be enhanced to their maximum potential to contribute to the overall success and growth of the organization.

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