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In most instances depreciation is a function of the expected life of the asset, as stated in years, although partial years may be used in some instances. The number of years that an asset is expected to last is determined by a primary driver(s) that correlates with the expected wasting of the asset, e.g. the number of miles that the equipment can be operated before it is ready for salvage. Time is also a factor, although it is seldom a primary factor.  Amtrak probably calculates the expected useful life of its equipment on expected miles to salvage divided by the number of anticipated annual operating miles.  However, without access to the company's records, it is not clear what variable(s) it uses. The amount of the annual depreciation is determined by dividing the initial cost of the asset by the years of its expected useful life. The cost of the asset includes the acquisition price, transportation-in, set-up costs, training, and capitalized interest, reduced by any expected salvage value.   If the equipment is subsequently overhauled, and the cost of the overhaul meets the GAAP capitalization tests, i.e. extends the useful life of the equipment, or increases the units of output, or increases the quality of the outputs, the cost of the overhaul is capitalized, which usually changes the depreciation schedule. The accounting models used to determine the useful lives of the equipment, as well as the estimated salvage value, are audited robustly by the external auditors. The notion that the numbers are just cobbled together, based on the differing whims of the cost accountants, is wrong.   If Amtrak's cost and depreciation models materially distorted its financial statements, the external auditors would be compelled to issue a qualified opinion.  Amtrak has never received a qualified auditor's opinion. That is not to say that its cost accounting cannot be improved.  Apparently it can be. But its costing models are not distorting its financial statements.
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