The AMORLINC function in Google Sheets is designed to calculate the depreciation of an asset over a given accounting period. This function is particularly useful for financial professionals looking to accurately account for depreciation on assets that may not have been acquired at the start of the accounting cycle.

Syntax

AMORLINC(cost, date_purchased, first_period, salvage, period, rate, [basis])

• cost: The initial cost of the asset.
• date_purchased: The date on which the asset was acquired.
• first_period: The first accounting period where depreciation is calculated.
• salvage: The estimated salvage value of the asset at the end of its useful life.
• period: The accounting period for which to calculate the depreciation.
• rate: The rate of depreciation as a decimal.
• [basis]: Optional; defines whether the year is based on a 360-day or 365-day year. Default is 0 for 360 days.

Example #1

=AMORLINC(10000, "2023-01-01", 1, 1000, 1, 0.2)

This function calculates the depreciation for an asset purchased for $10,000 with a salvage value of $1,000 over the first period. Result: $1,800.

Example #2

=AMORLINC(50000, "2022-04-15", 1, 5000, 3, 0.15)

Here, the function calculates depreciation for a $50,000 asset purchased on April 15, 2022, with a $5,000 salvage value over three periods. Result: $9,000.

Example #3

=AMORLINC(25000, "2022-06-01", 1, 3000, 2, 0.1, 1)

This function calculates asset depreciation of a $25,000 item acquired on June 1, 2022, with a salvage value of $3,000 over two periods, assuming a 365-day basis. Result: $4,750.

Error handling

• VALUE: Indicates that an invalid parameter has been provided; check your input types.
• NUM: Suggests that a numeric value is out of acceptable range; verify your numerical inputs.
• REF: Occurs when the function refers to an invalid cell reference; ensure that all references are correct.

Conclusion

In conclusion, the AMORLINC function is an invaluable tool for accountants and finance professionals, enabling precise calculation of asset depreciation across designated periods. Mastery of this function can enhance financial reporting and analysis, aiding in effective asset management.