Depreciation practice problems

A new asset every time. Fill in the depreciation schedule or the ledger accounts cell by cell, check each one, and print a worksheet with a worked key.

Layout
Level
How cells are marked
  • The key works each year from the rounded figure of the year before. Carrying the exact figure and rounding only what you write is also marked right.
  • Ledger accounts: pick the details from the list. Lines on the same date and the same side can go in any order. The disposal account has one spare line on each side: use one for the profit or loss and leave the other empty. Cambridge IGCSE calls the statement of profit or loss the income statement, and AAT calls the disposal account “disposals”; either name is marked right. AAT calls the provision for depreciation account “accumulated depreciation” and debits “Depreciation expense”, so that is also right on the provision’s depreciation lines.

Set

Invented businesses and figures, for practice only. Wide tables scroll sideways; Enter moves to the next cell.

    How the problems are made

    Each problem is an invented business with a real kind of asset, such as a delivery van, a forklift or office computers, at realistic costs, lives and rates. Every figure is worked with exact fractions and rounded once a year by the rule you choose, and no rounding ever lands on a half, so each cell has one right answer.

    A worked disposal

    In set RBVAN3, a business buys a delivery van on 1 December 2024 for $25,800 and depreciates it at 20% a year by reducing balance; its year ends on 30 June. The first year has 7 months: 20% × $25,800 × 7/12 = $3,010. Then 20% × $22,790 = $4,558 and 20% × $18,232 = $3,646. The van is sold on 1 March 2028, 8 months into the year: 20% × $14,586 × 8/12 = $1,945. Accumulated depreciation is $13,159, so the net book value is $12,641. Sold for $14,400, that is a profit of $1,759, debited to the disposal account. Open set RBVAN3

    What each level covers

    Schedules: straight-line (by life or by a rate on cost) and reducing balance, called written down value in the India layout; the US layout adds double-declining-balance, units-of-production and sum-of-the-years’-digits. Part years: an asset bought part way through the year. Ledger accounts: the asset and provision for depreciation accounts for three years, or US T-accounts. Disposal: the accounts for the year of sale and the profit or loss, or in the US the gain or loss and the journal entry.

    Questions

    How do you calculate straight-line depreciation?

    Take the residual value off the cost and divide by the useful life: the same charge every year. Some questions give a rate instead, such as 20% a year on cost. In a part year, charge the months owned out of 12.

    How does the reducing balance (written down value) method work?

    Apply the rate to the net book value at the start of each year, not to the cost. The charge falls every year and the book value never reaches zero. The rate already allows for the residual value, so nothing is taken off first.

    How do you work out double-declining-balance depreciation?

    The rate is twice the straight-line rate: 2 divided by the useful life, so 40% for a 5-year asset. Apply it to the book value at the start of the year without taking off the salvage value, but stop when book value reaches the salvage value.

    What goes in the provision for depreciation account?

    Each year's charge is credited to it (the debit goes to the statement of profit or loss), and the balance carried down is the accumulated depreciation. The asset account stays at cost. In the US the same account is called accumulated depreciation.

    How do you record the disposal of a non-current asset?

    Charge depreciation up to the date of sale. Then debit the disposal account with the cost, and credit it with the accumulated depreciation and the proceeds. The balancing figure is the profit (on the debit side) or the loss (on the credit side).

    Do you charge a full year's depreciation in the year of purchase?

    It depends on the business's policy, and the question will say. IAS 16 starts depreciation when the asset is available for use, and NCERT and OpenStax charge the months owned. Some exam questions charge a full year when bought and none when sold. Choose either under Part years.

    Sources, checked October 26, 2026: Cambridge IGCSE Accounting 0452 syllabus for 2026 (PDF), topic 4.2; Cambridge International AS & A Level Accounting 9706 syllabus 2026-2028 (PDF), topic 1.3.2; AAT Level 3 Diploma in Accounting specification, version 5.13 (PDF), Financial Accounting: Preparing Financial Statements 3.3 and 4.1; IAS 16 Property, Plant and Equipment, paragraphs 6, 50 to 62 and 71; NCERT Accountancy Part I, class 11, chapter 7: Depreciation, Provisions and Reserves (PDF); OpenStax Principles of Accounting, Volume 1, section 11.3 (straight-line, units-of-production and double-declining-balance).