What is straight-line depreciation?

Equal amount each year: (cost - salvage) / useful life. Simple and common for assets with even use over time.

When to use straight-line?

Buildings, office equipment, and when regulations or policy require it.

Yes. Then annual depreciation = cost / life.

Cost, salvage value, and useful life. Annual straight-line depreciation amount.

Cost ($)

Salvage value ($)

Useful life (years)

What is straight-line depreciation?: Equal amount each year: (cost - salvage) / useful life. Simple and common for assets with even use over time.
When to use straight-line?: Buildings, office equipment, and when regulations or policy require it.
Can salvage be zero?: Yes. Then annual depreciation = cost / life.

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