# Documentation/Calc Functions/AMORDEGRC

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AMORDEGRC

## Category:

Financial Analysis

## Summary:

Calculates the depreciation for a period using degressive depreciation, applying a depreciation factor that is dependent on the lifetime of the asset.

## Syntax:

AMORDEGRC(Cost; Date Purchased; First Period; Salvage; Period; Rate[; Basis])

## Returns:

Returns a non-negative real number.

## Arguments:

Cost is a positive real number or a reference to the cell containing that number which is the acquisition cost.

DatePurchased is a date or a reference to a cell containing that date which is the date of acquisition.

FirstPeriod is a date or a reference to a cell containing that date which is the end date of the first depreciation period.

Salvage is a positive real number or a reference to the cell containing that number which is the salvage value of the asset at the end of the depreciable life.

Period is a non-negative integer or a reference to the cell containing that number which is the settlement period to be considered. The value of 0 represents the period from the purchase date to the end of the first period. A value of 1 is the next year, and so on.

Rate is a positive real number (expressed as a percentage or a fraction) or a reference to the cell containing that number which is the rate of depreciation.

Basis is a positive integer from 0 to 4 or a reference to a cell containing that integer which is chosen from a list of options and indicates how the year is to be calculated. For more information, visit Wikipedia's Day count convention page.

Basis Calculation
0 or missing US method (NASD), 12 months of 30 days each
1 Exact number of days in months, exact number of days in year.
2 Exact number of days in month, year has 360 days.
3 Exact number of days in month, year has 365 days.
4 European method, 12 months of 30 days each.

• If either of DatePurchased or FirstPeriod are not valid dates then the function returns a value (#VALUE!) error. For more details about dates visit help.
• If either Rate or Cost is less than or equal to 0 then the function will return an error value.
• If either Salvage or Period is less than 0 then the function will return an error value.
• If Period is a non-integer non-negative real value, then it is truncated to an integer.
• If the DatePurchased date is after the FirstPeriod date then the function returns an error value.
• If Basis is a non-integer value, then the function uses its floor value, i.e. it is truncated to an integer value.
• After truncation if Basis is any number except 0,1,2,3,4 or missing,then the function will return an error value.

## Additional details:

• The coefficients for depreciation for AMORDEGRC are:
Life time of an asset t = 1/Rate Coefficient
0 <= t < 3 1
3 <= t < 5 1.5
5 <= t <=6 2
6 < t 2.5

Here for the Life of assets is (1/Rate).

• If the asset was purchased in the middle of the period, the depreciation is factored accordingly. Hence for period 0, the deprecation is equivalent to ROUND(Depreciation Factor * Cost * Rate * YEARFRAC (DatePurchased; FirstPeriod; Basis)). And for period 1 the depreciation is equivalent to ROUND(Depreciation Factor * Rate * (Cost – Depreciation from Previous Period)). And so on…
• The function will not depreciate beyond the point at which the total depreciation is greater than CostSalvage.
• For more details on amortization, visit Wikipedia.

## Examples:

Formula Description Returns
=AMORDEGRC(1500;"2001-04-01";"2001-06-15";454;2;0.19;2) The function calculates the amount of depreciation for a period as degressive amortization for the given value of arguments. 325
=AMORDEGRC(1500;"2001-04-01";"2001-06-15";454;2;19%;) The function calculates the amount of depreciation for a period as degressive amortization for the given value of arguments. Here the basis is the US method (0) whenever either empty or no argument is passed. 326
=AMORDEGRC(1500;"2001-04-01";"2001-06-15";454;2;0.9;0) The value of 0 is returned because the asset depreciates so rapidly relative to its Salvage value because of the high Rate. 0
=AMORDEGRC(1500,DATE(1,4,1),DATE(1,6,15),454,2,0.19,2) The function calculates the amount of depreciation for a period as degressive amortization for the given value of arguments. DATE function can also be used for passing dates. 325
=AMORDEGRC(1500,36982 ,37057 ,454,2,0.19,2) The function calculates the amount of depreciation for a period as degressive amortization for the given value of arguments. Numbers can also be used for passing dates. 325

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AMORDEGRC