Straight-line depreciation

Subtract supported salvage value from cost to find the depreciable amount. Then divide that amount by supported useful-life periods. The linked method example recomputes the full-period charge, accumulated amount, and carrying amount.

The pattern fits an asset whose service is consumed evenly with time. A building or licence can have that pattern. Straight-line fits poorly when output falls or early periods receive more service. Simplicity alone does not support the choice.

Compared with an accelerated pattern, straight-line reports less expense early and more later. Its carrying amount also remains greater until the schedules converge. Total lifetime depreciation is unchanged when the inputs remain the same. A proposed method change therefore requires evidence about timing.

Reconcile the schedule

Subtract supported salvage value from cost, divide by useful-life periods, and apply the stated partial-period convention from the readiness date. Each full period receives the same amount. Cumulative expense plus ending carrying amount must reconcile to cost, and carrying amount must not cross the salvage floor.

The systematic-and-rational requirement in ASC 360-10-35-4 applies to the selected service pattern. The paragraph does not make straight-line a default when no pattern review was done.

The Linden Peak method example provides a checked schedule. Method-control practice holds the estimates constant while comparing timing.

Boundaries

Straight-line is a book allocation method. It is not a tax convention, a market-value estimate, or proof that physical wear occurs evenly. Review a change in useful life or salvage value as an estimate question. Review a change in the service pattern under the applicable method-change guidance. Preserve the old schedule and the information date instead of rewriting prior support.