The image above represents depreciation value.

To compute for depreciation value, three essential value are needed and these parameters are **Present Amount or Worth (P), Salvage Value (S) **and **Total Estimated Life of the Asset (N).**

The formula for calculating depreciation value:

D = (P – S) / N

Where:

P = Present worth or amount

N = Total estimated life of an asset

S = Salvage value

Let’s solve an example;

Find the depreciation value when the present amount or worth is 9, the salvage value is 4 and the total estimated life of an asset is 10.

This implies that;

P = Present worth or amount = 9

N = Total estimated life of an asset = 10

S = Salvage value = 4

D = (P – S) / N

D = (9 – 4) / 10

D = 5 / 10

D = 0.5

Therefore, the **depreciation value** is **₦0.5.**

**Calculating the Present Amount or Worth when the Depreciation Value, the Total Estimated life of an Asset and the Salvage Value is Given.**

P = (D x N) + S

Where;

P = Present worth or amount

D = Depreciation Value

N = Total estimated life of an asset

S = Salvage value

Let’s solve an example;

Find the present amount or worth when the depreciation value is 22, the total estimated life of an asset is 12 and the salvage value is 8.

This implies that;

D = Depreciation Value = 22

N = Total estimated life of an asset = 12

S = Salvage value = 8

P = (D x N) + S

P = (22 x 12) + 8

P = 264 + 8

P = 272

Therefore, the **present amount or worth **is **272.**