84 Section 4: Additional Financial FunctionsDepreciation Calculations

The hp 12c platinum enables you to calculate depreciation and the remaining depreciable value (book value minus salvage value) using the straight-line, sum-of-the-years-digits, and declining-balance methods. To do so with any of these methods:

1.Enter the original cost of the asset, using $.

2.Enter the salvage value of the asset, using M. If the salvage value is zero, press 0M.

3.Enter the expected useful life of the asset (in years), using n.

4.If the declining-balance method is being used, enter the declining-balance factor (as a percentage), using ¼. For example, 1.25 times the straight-line rate — 125 percent declining-balance — would be entered as 125¼.

5.Key in the number of the year for which depreciation is to be calculated.

6.Press:

z fVfor depreciation using the straight-line method.

z fÝfor depreciation using the sum-of-the-years digits method. z f#for depreciation using the declining-balance method.

fV, fÝ, and f#each place the amount of depreciation in the display. To display the remaining depreciable value (the book value less the salvage value) after the depreciation has been calculated, press ~.

Example: A metalworking machine, purchased for $10,000, is depreciated over 5 years. Its salvage value is estimated at $500. Find the depreciation and remaining depreciable value for the first 3 years of the machine’s life using the declining-balance method at double the straight-line rate (200 percent declining-balance).

Keystrokes

Display

 

10000$

10,000.00

Enters original cost.

500M

500.00

Enters salvage value.

5n

5.00

Enters expected useful life.

200¼

200.00

Enters declining-balance factor.

1f#

4,000.00

Depreciation in first year.

~

5,500.00

Remaining depreciable value after

 

 

first year.

2f#2,400.00

Depreciation in second year.

File name: hp 12c pt_user's guide_English_HDPMF123E27

Page: 84 of 275

Printed Date: 2005/8/1

Dimension: 14.8 cm x 21 cm