Straight-line Depreciation
Definition of "Straight-line depreciation"
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.
Popular Real Estate Terms
maintenance procedures conducted to prevent later repairs and furthering a longer useful life. For example, many boilers and burners are cleaned and serviced each year before the winter ...
Uniform charge for transportation and delivery of household items to a homeowner within a particular locality. ...
A contract not in writing. Oral contracts are legally enforceable except for those applicable to the sale of real estate. ...
If you’re an owner of a property that needs to be accounted for in your return on investment or used to calculate your capital gains and losses, then the cost basis will help you ...
An obligation of the owner of property that is recorded with his permission such as a mortgage. Encumbrance on property without being objected to by the owner. ...
The cost of property, such as a home owned for tax purposes. For example, a home was purchased for $150,000. capital improvements to it cost $15,000. The house was later sold for $230,000. ...
(1) Individual or business that is engaged to do some sort of construction work for another for a fee. There are basically three types of contracting: A general contractor enters into a ...
Architectural style featuring a long low roof line with a continuous row of windows and a plain exterior. It is very open design with long horizontal lines rather than having small secluded ...
Formal allegations by all of the parties to an action including complaints, answers, and replies to counterclaims. ...
Have a question or comment?
We're here to help.