Howard,
I've double checked the calculation and there is no error. You can see on the Instructions page of the workbook the exact formulae used to calculate depreciation. Here is what it says:
The reason why there is a difference from your expected depreciation is that my workbook uses a
daily calculation basis, not a monthly one.
Let me illustrate:
For assets with total historic cost of 28,872.49 and a book life of 60 months:
- your calculation gives a monthly depreciation of 28,872.49 / 60 = 481.21
- my calculation:
book life (in days) = book life (in months) x 30.4375, rounded down to the nearest integer
so book life (in days) = 60 x 30.4375 rounded to 1,826
depreciation calculation for January is 31 days x (28,872.49 / 1,826) = 490.17
Both are correct, just use a slightly different approach. As I said before, I've been using my workbook for years without a single problem. I believe it to be flawless, but it has the downside of being a bit inflexible.
Regards,
James