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Accounting
Double-Declining Balance Depreciation
An accelerated method that records more depreciation expense in the early years of an asset's life.
Double-declining balance ignores residual value until the end and switches to straight-line in the final years so the asset never goes below salvage value. It's great for things that lose value fast.It's like a car losing the most value the moment you drive it off the lot — the biggest drop happens right at the beginning.
Real world: A $20,000 computer with a 5-year life gets 40% depreciation in year one ($8,000), then 40% of the remaining balance each year after.
💡 Double-declining balance matches the real-world pattern of many assets — they work hardest and lose value quickest when they're brand new.