Straight-line depreciation is a method of allocating the cost of a tangible asset evenly over its useful life. This approach simplifies the accounting process by spreading out the asset's initial purchase price into equal annual expenses, reflecting a steady decrease in value. It is widely used in financial reporting and tax calculations, making it a key concept in understanding how assets are depreciated over time.
congrats on reading the definition of straight-line depreciation. now let's actually learn it.