Accounting & Finance
Annual and monthly expense
Straight-line spreads the base evenly across the years.
The Formula
Annual = Base / Life; Monthly = Annual / 12
Straight-line spreads the base evenly across the years.
| Symbol | Meaning | Unit | Notes |
|---|---|---|---|
| B | Depreciable base | currency | Cost minus salvage. |
| L | Useful life | count | Life in years. |
What Each Symbol Means
Bcurrency
Depreciable base
Cost minus salvage.
Lcount
Useful life
Life in years.
See It Worked With Real Numbers
A formula on its own does not tell you which number goes where. The how to calculate depreciation page applies this equation to a concrete case, shows every intermediate step, and names the mistakes that produce a wrong answer even when the algebra is right.
Where This Formula Appears
This equation is the working core of How To Calculate Depreciation, filed under Business. Every number the guide produces comes from substituting into this one line.