AMORDEGRC function: Description, Usage, Syntax, Examples and Explanation

Syntax of AMORDEGRC function

AMORDEGRC(cost, date_purchased, first_period, salvage, period, rate, [basis])

The AMORDEGRC function syntax has the following arguments:

• Cost: The cost of the asset.
• Date_purchased:  The date of the purchase of the asset.
• First_period: The date of the end of the first period.
• Salvage: The salvage value at the end of the life of the asset.
• Period: The period.
• Rate : The rate of depreciation.
• Basis(Optional): The year basis to be used.

Note: Problems can occur if dates are entered as text. Therefore, all dates should be entered by using the DATE function, or formatted as date under format cell to avoid errors.

AMORDEGRC formula explanation

• Microsoft Excel stores dates as sequential serial numbers so they can be used in calculations. By default, January 1, 1900 is serial number 1, and January 1, 2008 is serial number 39448 because it is 39,448 days after January 1, 1900.
• This function will return the depreciation until the last period of the life of the assets or until the cumulated value of depreciation is greater than the cost of the assets minus the salvage value.
• The depreciation coefficients are:

• The depreciation rate will grow to 50 percent for the period preceding the last period and will grow to 100 percent for the last period.
• If the life of assets is between 0 (zero) and 1, 1 and 2, 2 and 3, or 4 and 5, the #NUM! error value is returned.

Example of AMORDEGRC function

Steps to follow:

1. Open a new Excel worksheet.

2. Copy data in the following table below and paste it in cell A1

Note: For formulas to show results, select them, press F2 key on your keyboard and then press Enter.

You can adjust the column widths to see all the data, if need be.