#### CA Rohit

##### New Member

I have a serious problem, hope someone could solve the same for me.

I have to calculate the written down value (WDV) as on specific date. I have tried to explain how the method works for those who are unaware of the same

- This method involves applying the depreciation rate on the Net Book Value (NBV) of asset. In this method, depreciation of the asset is done at a constant rate.

- In this method depreciation charges reduces each successive period.

- Assume the price of a depreciable asset i.e. computer is Rs. 40,000 and rate of depreciation is 10%

So in our example, the depreciation amount during the first year is

[Rs. 40,000*1/10] =Rs. 4,000

NBV of computer after 1st year= Rs 40,000- 4,000 = Rs. 36,000

Depreciation for 2nd year is

[Rs. 36,000*1/10] =Rs. 3,600 and so on...

I know it forms geometric progression but the formula is not giving the proper answer and the technicalities increases when i have to calculate depreciation day wise.

For e.g. I have purchased a printer on 22/11/2012 for 16,800/-, the depreciation on which is 40%, Depreciation for the financial year ending 31/03/2013 would be 2393.42 for 130 days (31/03/2013-22/11/2012+1), and for the year ending 31/03/2014 it would be 5762.63 (16800-2393.42)*40%.

Now I want a formula wherein I can find the WDV as on particular date say 31/03/2014. I tried using the formula - WDV as on Date = Cost price x (1- Dep Rate%) ^ (Date of WDV Calculation - Date of Purchase + 1)/365. But the answer it gives for the above example is 8403.22, wherein if we calculate year wise it is (16800-2393.42-5762.63)=8643.95.

Kindly help me.

Thanks in Advance