Hello.
I come again to kindly ask for help from you who know a lot about HP. I cannot make the result of the calculation of decreasing depreciation (DecBal) provide the same result on the HP30b calculator and on paper.
The problem consists of the following:
- Cost (Czero)= $ 25000
- Salvage = $ 5000
- Life = 15 years
- Factor =10.174%
On paper D (n) = Czero * (1- Factor) ^ n
in year 1 I have 22,456.50
in year 3 I have 18,119.49
in year 6 I have 13,132.64
in year 12 I have 6,898.65
(n = year use as Factor 10.174%)
On the HP30b calculator (use as Factor 10.174%):
in year 1 I have 24,830.70 (R.Book)
in year 3 I have 24,494.94
in year 6 I have 24,000.08
in year 12 I have 23,040.16
Where am I going wrong? I couldn't get the answer on the Learning Modules.
Thanks!
Methods of Depreciation: Formulas, Problems, and Solutions
Straight Line Method
Declining Balance Method
Declining Balance Method is sometimes called the Constant-Percentage Method or the Matheson formula. The assumption in this depreciation method is that the annual cost of depreciation is the fixed percentage (1 - K) of the Book Value (BV) at the beginning of the year.
Annual Rate of Depreciation(K): SV = FC (1 - K)
n
source:
Depreciation Methods in Engineering Economics
Any SME's with the formula/equation deployed in the HP-30B ?
BEST!
SlideRule
(25000 - 5000)*(1 - 10.174/1200) + 5000 = 24830.43
So it would seem it works per month i.o. per year.
Werner
(03-12-2021 12:05 AM)FabioBrasil Wrote: [ -> ]Hello.
I come again to kindly ask for help from you who know a lot about HP. I cannot make the result of the calculation of decreasing depreciation (DecBal) provide the same result on the HP30b calculator and on paper.
The problem consists of the following:
- Cost (Czero)= $ 25000
- Salvage = $ 5000
- Life = 15 years
- Factor =10.174%
On paper D (n) = Czero * (1- Factor) ^ n
in year 1 I have 22,456.50
in year 3 I have 18,119.49
in year 6 I have 13,132.64
in year 12 I have 6,898.65
(n = year use as Factor 10.174%)
On the HP30b calculator (use as Factor 10.174%):
in year 1 I have 24,830.70 (R.Book)
in year 3 I have 24,494.94
in year 6 I have 24,000.08
in year 12 I have 23,040.16
Where am I going wrong? I couldn't get the answer on the Learning Modules.
Thanks!
It looks like your paper version is correct.
Code:
DECLARE FUNCTION D
INPUT PROMPT "Cost? ":Czero
INPUT PROMPT "Salvage? ":Salvage
INPUT PROMPT "Factor? ":Factor
LET n = 1
DO UNTIL D(n) <= Salvage
PRINT n,USING$("$##,###.##",D(n))
LET n = n + 1
LOOP
FUNCTION D(n)
LET D=Czero*(1-Factor)^n
END FUNCTION
END
Cost? 25000
Salvage? 5000
Factor? .10174
1 $22,456.50
2 $20,171.78
3 $18,119.50
4 $16,276.02
5 $14,620.10
6 $13,132.65
7 $11,796.53
8 $10,596.35
9 $ 9,518.28
10 $ 8,549.89
11 $ 7,680.03
12 $ 6,898.66
13 $ 6,196.79
14 $ 5,566.33
15 $ 5,000.01
FabioBrasil
Did we help you answer your question?
BEST!
SlideRule
Thank you for your help! It is good to have good people.
Fabio,
This is how I get the same answer on the HP12c (I don't have an hp30b to check it out, sorry).
25000 -> PV
15 -> n
152.61 -> i (that is 10.174 * 15)
Both PMT and FV = 0.
Then 1 DB yields
2543.50
x<-->y
22456.50 (which is your first year answer on paper).
Summing up, try i=152.61 (i*n) on the hp30b for the Declining Balance method.
Hope this helps,
Paul
(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)
Paul0207, Thank you very much!
You solved the problem with Factor = rate * lifetime. In the Declining Balance mode (DecBal) this made me arrive at the same values of the exercise. Many, many thanks to all the colleagues who taught me a lot!
Paul0207, most things are the same on the HP12C and the HP30b. So much the same, that I use programs written for the HP12c on the HP30b with few modifications. And you don't need to apologize for anything, I appreciate your help!