Depreciation - different results on HP30b and on paper

[Albert Chan]

(03-13-2021 04:25 AM)paul0207 Wrote:  Summing up, try i=152.61 (i*n) on the hp30b for the Declining Balance method.

Yes! This is from HP-12C Appendix D, formula used for DecBal:

DPN_j = RBV_j-1 * FACT / (100L), for j = 1, 2, ..., L

We can also consider DecBal as TVM problem, with negative interest rate:

10.174 [CHS] [I]
25000 [CHS] [PV]
0 [PMT]

Book values, for different years:

1 [N] [FV]       → 22456.50
3 [N] [FV]       → 18119.50
6 [N] [FV]       → 13132.65
12 [N] [FV]      →  6898.66
15 [N] [FV]      →  5000.01

We can derive book value formula directly, by fitting the power law:

book_value / cost = (salvage / cost) ^ (years / life)

when exponent = 0, book_value = cost
when exponent = 1, book_value = salvage

For above example, we have:

book_value = 25000 * 0.2 ^ (years/15)