Depreciation is an accounting method used to record the expected decrease or diminution in the value of an asset due to general usage, wear and tear and obsolescence over a period of years.
In the Straight Line Depreciation method, the value of the asset is depreciated in a uniform manner over the lifespan of the asset. It is calculated using the following formula :
Annual Straight Line Depreciation = ( Value of the asset – Salvage value ) / Life of the asset in Years