# Download PDF of Solve example For Straight-Line Method

* Welcome back to our blog in today's post we are going to solve an annual depreciation expense example by straight-line method. Well straight-line depreciation method is quite famous this method is used to **allocate the cost of a long-term asset evenly over its estimated useful life.*

*Straight-Line Depreciation Formula*

*Annual Depreciation Expense = (Cost of Asset - Salvage Value) / Useful Life*

*Now let's calculate **annual depreciation expense using the straight-line method of depreciation*

* Example For Straight-Line Depreciation Method*

**Example :1**

*Company XYZ purchases a piece of machinery for 20,000. The machinery has an estimated useful life of 5 years and no salvage value (meaning it's expected to have no value at the end of its useful life). Calculate the annual depreciation expense.*

**Step 1:- Use the formula**

*Formula:- Annual Depreciation Expense = (Cost of Asset - Salvage Value) / Useful Life*

**Step 2:- Now calculate the values**

*Annual Depreciation Expense = 20,000 / 5 years*

*Annual Depreciation Expense = 4,000 per year*

*So, the annual depreciation expense for the machinery is 4,000. *

**Example 2:**

*Company ABC purchases a delivery van for 25,000 INR with an estimated useful life of 4 years and no expected salvage value. They want to calculate the annual depreciation expense for the van.*

You can solve this example usingstraight-line depreciation methods.

*Conclusion*

*Here in this post, we add some examples of** straight-line depreciation methods so if you are an accounting student then you should read this pot till the end.*

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