Straight Line Depreciation Formula, Definition and Examples
Straight-line depreciation, on the other hand, spreads the loss of value evenly across the asset’s useful life, providing consistent expense amounts year over year. It assumes an asset will lose the same amount of value each year and works well for assets that lose value steadily over time. Accelerated depreciation recognizes a higher loss of value in the earlier years of an asset’s lifespan, reflecting faster wear-and-tear or obsolescence upfront. This approach can be beneficial…