Depreciation calculator

Calculate straight-line depreciation expense per year. Enter asset cost, salvage value, and useful life.

Asset cost ($) Salvage value ($) Useful life (years)

Straight-line depreciation formula

Annual Depreciation = (Cost − Salvage Value) / Useful Life

Example: $10,000 asset, $1,000 salvage, 5 years: ($10,000 − $1,000) / 5 = $1,800/year.

What is depreciation?

Depreciation spreads the cost of an asset over its useful life. It's an accounting expense, not a cash outflow. The asset loses value each year on the balance sheet.

Book value

Book value = Cost − Accumulated Depreciation. After 3 years: $10,000 − (3 × $1,800) = $4,600.