straight-line depreciation


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Straight-line depreciation

Amortizing or apportioning an equal dollar amount of depreciation in each accounting period.

Straight-Line Depreciation

A system of depreciation in which one deducts the same amount every year. For example, suppose an asset costs $1,200 with a usable life of three years and a salvage value of $300. If one uses straight-line depreciation, one deducts $300 each year.

straight-line depreciation

A method of recording depreciation such that the original cost minus the estimated salvage value of an asset is written off in equal amounts during each period of the asset's life. For example, a machine costing $10,000 with an estimated life of five years and no salvage value would be depreciated $2,000 ( $10,000/5 ) annually, using straight-line depreciation. If the machine had an estimated salvage value of $4,000, annual straight-line depreciation would amount to $1,200. Compare accelerated depreciation.

straight-line depreciation

A method of accounting for the gradual loss in value of an asset over time by predicting that the asset's value will decline in equal amounts each year over a specified number of years.The method is also used for tax purposes as an expense allowed each year for the supposed loss in value of an asset,even though it might actually be increasing in value.See depreciation.

Straight-Line Depreciation

A method of computing depreciation under which the depreciation deduction is the same for each full year.
References in periodicals archive ?
179 and straight-line depreciation: $100,000 * (Sec.
1250 gain is the amount of capital gain that would have been taxed at ordinary income rates under the old laws if the old laws applied to straight-line depreciation. After this entire component of the gain is recognized, the remaining gain will then be recognized and taxed at 20%.
courts have determined that although straight-line depreciation may be
Allowing for an immaterial difference in the initial year, North Carolina's convention for bonus depreciation is essentially straight-line depreciation over six years, regardless of the modified accelerated cost recovery system (MACRS) recovery period.
As a general rule, the cost of commercial real estate improvements is recovered over 39 years via straight-line depreciation. Sees.
There are four possible accounting methods, all of which employ straight-line depreciation with various lives (four or five years) and with various salvage values ($0 or $1,000).
A building, termed "section 1250 property", is generally 39-year property eligible for straight-line depreciation and equipment or furniture termed "section 1245 property", is personal property.
(2.) The two companies use different depreciation policies: HJ depreciates its noncurrent assets using straight-line depreciation at the rate of 20 per cent of cost with no residual value; KL uses the reducing-balance method at 25 per cent per annum.
Therefore, yearly interest cost will be $228,000.00 ($2,850,000*.08=$228,000.) The straight-line depreciation method is used for the new plant for its useful-life of 10 years.
However, the IRS looks more closely at a business choosing alternative depreciation methods, even straight-line depreciation for newly-acquired property, rather than using the no-questions-asked modified asset cost recovery system.
The fees are basically straight-line depreciation of the cost of each asset over its expected useful life, modified by an inflation factor.
In respect of the economic life of its assets, Telecom has depreciating fixed assets (at 30.6.2006) with an aggregate historic cost of $11,000m, aggregate depreciated historic cost of $3200m, depreciation of $538m, and it uses the straight-line depreciation methodology.