Straight-Line Depreciation Calculator
Calculate even annual depreciation for any asset. Enter the cost, salvage value, and useful life to see a complete depreciation schedule.
Depreciation Schedule
Year-by-Year Breakdown
| Year | Depreciation | Accumulated | Book Value |
|---|---|---|---|
| 0 | - | $0.00 | $50,000.00 |
| 1 | $4,500.00 | $4,500.00 | $45,500.00 |
| 2 | $4,500.00 | $9,000.00 | $41,000.00 |
| 3 | $4,500.00 | $13,500.00 | $36,500.00 |
| 4 | $4,500.00 | $18,000.00 | $32,000.00 |
| 5 | $4,500.00 | $22,500.00 | $27,500.00 |
| 6 | $4,500.00 | $27,000.00 | $23,000.00 |
| 7 | $4,500.00 | $31,500.00 | $18,500.00 |
| 8 | $4,500.00 | $36,000.00 | $14,000.00 |
| 9 | $4,500.00 | $40,500.00 | $9,500.00 |
| 10 | $4,500.00 | $45,000.00 | $5,000.00 |
About This Tool
The Straight-Line Depreciation Calculator is the simplest way to determine how much an asset loses in value each year. Straight-line depreciation spreads the depreciable cost of an asset evenly across its useful life, making it the most widely used depreciation method for financial reporting under both GAAP and IFRS.
The Straight-Line Depreciation Formula
The formula is straightforward:
Annual Depreciation = (Asset Cost - Salvage Value) / Useful Life
The numerator (Cost minus Salvage Value) is called the depreciable base or depreciable cost. This is the total amount that will be expensed over the asset's life. The denominator is the estimated useful life in years. Each year, you expense the same dollar amount, which makes budgeting and forecasting predictable.
When to Use Straight-Line Depreciation
Straight-line depreciation is best suited for assets that provide relatively consistent benefits over their useful life. Common examples include buildings, leasehold improvements, and certain types of office furniture. It is also the default method used in many accounting software systems because of its simplicity.
Straight-Line vs. Accelerated Methods
While straight-line depreciation provides consistent annual expenses, accelerated methods like double-declining balance and MACRS front-load depreciation, providing larger deductions in early years. For tax purposes, accelerated depreciation reduces taxable income more in the first few years, improving cash flow. However, total depreciation over the asset's life is the same regardless of the method used.
Partial-Year Depreciation
When an asset is acquired partway through the year, many companies prorate the first and last year's depreciation. For example, if an asset is purchased on April 1, only 9/12 of the annual depreciation would be recorded in the first year, and 3/12 in the final year. This calculator shows full-year depreciation for simplicity.
Impact on Financial Statements
Depreciation expense appears on the income statement, reducing net income. Accumulated depreciation appears on the balance sheet as a contra-asset, reducing the carrying value of fixed assets. The net book value (cost minus accumulated depreciation) represents the remaining undepreciated investment in the asset.