Asset Depletion Calculator

Formula

The formula to calculate the Asset Depletion (AD) is:

\[ AD = \frac{TA}{P} \]

Where:

$ AD $ is the Asset Depletion ($/month)
$ TA $ is the total assets ($)
$ P $ is the total time period (months)

Asset Depletion Definition

Asset depletion is a method used to determine the monthly income generated from liquidating assets over a specified period. It is commonly used in financial planning and mortgage qualification processes.

Example Calculation

Let's consider an example:

Total Assets (TA): $120,000
Total Time Period (P): 60 months

Using the formula to calculate the Asset Depletion:

\[ AD = \frac{120000}{60} = 2000 \, \text{\$/month} \]

This demonstrates that with total assets of $120,000 and a time period of 60 months, the asset depletion would be $2,000 per month.