1. Accounting
  2. Fixed Assets Management
  3. Setting Up the Fixed Assets Management System
  4. Depreciation Methods
  5. Depreciation Formula
  6. Formula Example: Straight Line Depreciation

Formula Example: Straight Line Depreciation

Straight line depreciation formula:

(CC-RV)/AL

(Current Asset Cost – Residual Value) / Asset Lifetime

Example:

Current Asset Cost: 20,000

Residual Value: 2,000

Asset Lifetime: 60 months

(20,000 – 2,000) / 60 = 300

As it is a straight line depreciation this will be the same depreciation amount every month.

Related Topics

General Notices