The Excel SLN function has the syntax shown below.

SLN (cost, salvage, life)

**Arguments used in the Excel SLN function**

Cost = The initial cost of the asset

Salvage = The salvage or residual value of the asset

Life = The useful life of the asset

## Use of the Excel SLN Function

The Excel SLN function is used to calculate the periodic straight line depreciation of a long term asset.

## Straight Line Depreciation SLN Function Example

If a business purchases an asset costing 10,000 which is estimated to have a useful life of 5 years and a salvage value of 600, then the annual straight line depreciation is calculated using the Excel SLN function as follows:

Cost = 10,000 Salvage = 600 Life = 5 years Depreciation = SLN (cost, salvage, life) Depreciation = =SLN (10000,600,5) Depreciation = 1,880

Using the Excel SLN function the straight line depreciation for the asset is calculated as 1,880 a year.

## Using the Excel SLN Function for Monthly Periods

In the above example the Excel SLN function was used to calculate the annual depreciation. The function could equally well be used to calculate the monthly depreciation by defining the life in terms of months instead of years.

Suppose for example, the business purchased an asset costing 5,000 with an estimated salvage value of 800 and a useful life of 30 months, then using the Excel SLN function the monthly straight line depreciation is calculated as follows:

Cost = 5,000 Salvage = 800 Life = 30 months Depreciation = SLN (cost, salvage, life) Depreciation = =SLN (5000,800,32) Depreciation = 140

The straight line depreciation is calculated as 140 a month.

The Excel SLN function is one of many Excel finance functions used in financial calculations, discover another at the links below.

## About the Author

Chartered accountant Michael Brown is the founder and CEO of Double Entry Bookkeeping. He has worked as an accountant and consultant for more than 25 years in all types of industries. He has been the CFO or controller of both small and medium sized companies and has run small businesses of his own. He has been a manager and an auditor with Deloitte, a big 4 accountancy firm, and holds a BSc from Loughborough University.