Result
Useful life, years
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This calculation is for informational purposes only and does not replace advice from a qualified professional. Formulas and rates may not fit your exact situation — double-check the figures before making decisions.
How it is calculated
Useful life = (original cost − salvage value) ÷ annual depreciation. This is the straight-line depreciation formula solved for the term instead of the yearly write-off amount.
The calculation is handy in the reverse situation: when you know how much the company wants or needs to write off per year (say, to fit a budget or an accounting policy's depreciation rate) and need to know how many years that spreads over.
The result is a fractional number of years: in practice the term is usually rounded to a whole number of years or months in the accounting policy, so the actual annual depreciation amount may differ slightly from the one entered here.