Calculating your annual depreciation is straightforward once you know the Straight Line Depreciation formula and what each input means. This guide explains the method in plain language, walks through a manual calculation, and gives worked examples you can follow — then you can do it instantly with the Straight Line Depreciation Calculator.
What is Straight Line Depreciation?
The Straight Line Depreciation calculation tells you your annual depreciation from a few simple inputs. The figure you are solving for here is the annual depreciation, expressed in INR.
The Straight Line Depreciation formula
The core formula is:
Annual depreciation = (Asset cost - Salvage value) ÷ Useful lifeHere is what each input means:
- Asset cost — a money amount. Example: ₹1,00,000.
- Salvage value — a money amount. Example: ₹10,000.
- Useful life — a value measured in years. Example: 5 years.
How to calculate it step by step
- Write down the asset cost (for example, ₹1,00,000).
- Write down the salvage value (for example, ₹10,000).
- Write down the useful life (for example, 5 years).
- Apply the formula above to get your annual depreciation.
- Double-check the result with the Straight Line Depreciation Calculator.
Worked examples
Example 1
| Input / Output | Value |
|---|---|
| Asset cost | ₹1,00,000 |
| Salvage value | ₹10,000 |
| Useful life | 5 years |
| Annual depreciation | ₹18,000 |
| Depreciation rate | 18.00% |
With asset cost of ₹1,00,000, salvage value of ₹10,000 and useful life of 5 years, the annual depreciation works out to ₹18,000.
Example 2
With asset cost of ₹2,00,000, salvage value of ₹10,000 and useful life of 5 years, the annual depreciation works out to ₹38,000.
| Result | Value |
|---|---|
| Annual depreciation | ₹38,000 |
| Depreciation rate | 19.00% |
Example 3
With asset cost of ₹50,000, salvage value of ₹10,000 and useful life of 5 years, the annual depreciation works out to ₹8,000.
| Result | Value |
|---|---|
| Annual depreciation | ₹8,000 |
| Depreciation rate | 16.00% |
Tips for an accurate result
- Keep your units consistent — mixing, say, months with years or grams with kilograms is the most common source of error.
- Round only at the very end. Rounding inputs early can shift the final answer noticeably.
- Re-run the numbers whenever an input changes, rather than estimating from an old result.
Prefer not to do the maths by hand? — the Straight Line Depreciation Calculator does it instantly, for free, with the formula and a worked example built in.
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