The depreciation method where an equal amount of depreciation expense is allocated to each full period of the asset's useful life. The amount of depreciation is computed as follows; Annual depreciation = (Original costs -Salvage value)/ Useful life. For example, assume that the building costs $800,000 and has an estimated useful life of 20 years. The estimated salvage value at the end of the 5-year period is $200,000. Then the straight-line depreciation per year is ($800,000 - $200,000)/20 years= $30,000/year.