Accounting Dictionary - Letter S

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Sum-of-the-years-digits depreciation
applies a decreasing rate to the depreciable cost (i.e., cost less salvage value) and produces a decreasing depreciation expense over the asset useful life. The decreasing rate equals the fraction of a current year's digit to the total of all year digits in the asset useful life. For example, if an asset has a 5-year useful life, depreciation for the first year can be calculated by multiplying the asset depreciable cost by 5 and dividing the result by 15 (i.e., 1 + 2 + 3 + 4 + 5).
Go Back
Don't see the term you are looking for? Try searching our entire website:
Not a member?
See why people join our
online accounting course:
Free Study Notes
Download free accounting study notes by signing up for our free newsletter (example):
First Name:
E-mail:
We never share or sell your e-mail to third parties.