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The Excel AMORDEGRC Function
Basic Description
The Excel Amordegrc function calculates the prorated linear depreciation of an asset for each accounting period,
with a depreciation coefficient applied, depending on the life of the asset.
The function has been introduced into Excel for users of the French accounting system.
The syntax of the Amordegrc function is :
AMORDEGRC( cost, date_purchased, first_period, salvage, period, rate, [basis] )
Where the arguments are as follows:
| cost |
- |
The cost of the asset
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| date_purchased |
- |
The date of purchase of the asset
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| first_period |
- |
The date of the end of the first period
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| salvage |
- |
The salvage value, at the end of the lifetime of the asset
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| period |
- |
The number of the period over which the depreciation is to be calculated
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| rate |
- |
The asset's rate of depreciation
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| [basis] |
- |
An optional integer argument which specifies the financial day count basis to be is used.
This may be any of the following values:
| Basis |
Day Count Basis |
| 0 (or omitted) |
US (NASD) 30/360 |
| 1 |
actual/actual |
| 2 |
actual/360 |
| 3 |
actual/365 |
| 4 |
European 30/360 |
A detailed description of the financial day count basis rules is provided on the
Wikipedia Day Count Convention page
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Note that the date arguments should be entered into the function as either:
- References to cells containing dates
or
- Dates returned from formulas
Warning:
| - |
If you attempt to input the dates as text, they may be misinterpreted,
due to the date system and date interpretation settings on your computer. |
| - |
Although dates can be entered as serial numbers, this is not advised, as date serial
numbering varies across different computer systems. |
Excel Amordegrc Function Example
In the following example, the Excel Amordegrc function is used to calculate the depreciation of an asset during
the first period. The asset was purchased on 01-Jan-2011, at a cost of €150 and the first period ends on
30-Sep-2011. The asset depreciates at a rate of 20% per year and has a salvage value of €20. The European
day count basis is used.
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A |
B |
| 1 |
Purchase Date: |
01-Jan-2011 |
| 2 |
First Period Date: |
30-Sep-2011 |
| 3 |
=AMORDEGRC( 150, B1, B2, 20, 1, 20%, 4 ) |
The function returns the value 42.
- i.e. the asset depreciates by €42.00 during the first period.
Note that, as recommended by Microsoft, the date arguments have been input to the above function as references to
cells containing dates.
Further details and examples of the Excel Amordegrc function can be found on the
Microsoft Office website.
Amordecrc Function Errors
If you get an error from the Amordegrc function, this is likely to be one of the following:
Common Errors
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#VALUE!
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Occurs if either:
| - | any of the supplied arguments are non-numeric |
| or | |
| - | the supplied date_purchased or first_period are not a valid dates |
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#NUM!
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Occurs if either:
| - | the date_purchased is > first_period |
| or | |
| - | the supplied salvage value is > cost |
| or | |
| - |
Invalid numbers are supplied for the salvage, period, rate or basis arguments
(i.e. if either: salvage < 0, period < 0, rate ≤ 0, or basis is any number other than 0, 1, 2, 3 or 4)
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#NAME?
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-
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Occurs when Analysis ToolPak add-in is not enabled in your Excel.
You will need to enable the add-in if you want to use the Excel Amordegrc function.
To do this in Excel 2003 :
- From the Tools drop-down menu, select the option Add-Ins ...
- An 'Add-Ins' window will pop up. From this, select the option Analysis ToolPak and click OK
To do this in Excel 2007 or Excel 2010 :
- Click the Microsoft button on the top left of your spreadsheet and select
the Excel Options button
- From the menu on the left hand side, select Add-Ins
- In the 'Manage:' box, select Excel Add-ins and click Go...
- An 'Add-Ins' window will pop up. From this, select the option Analysis ToolPak
and click OK
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