• Straight Line Method \[D = \frac{V-V_s}{n}\] where

    \(D\) = annual depreciation amount
    \(V\) = original value of the property at the start of the service period
    \(V_s\) = salvage value (or scrap value, or residual value) of the property at the end of service life
    \(n\) = service life, years

    The asset value (or book value) \(V_a\) of the equipment at any time \[V_a = V-aD\] where \(a\) is the number of years in actual use.

    Straight line method is also called as fixed installment method. Depreciation of fixed assets is uniform throughout the year.