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Glite Dictionary
straight-line method of depreciation

straight-line method of depreciation

6.8
A way of charging the same cost each year for an asset that loses value
  • noun
  • /ˈstreɪtˌlaɪn ˈmɛθəd əv dɪˌpriːʃiˈeɪʃən/
  • Specialized
translation icon : método de línea recta de depreciación
  • Under the straight-line method of depreciation, the annual expense remains constant throughout the asset's useful life.

Examples

  • Many companies use the straight-line method of depreciation to allocate the cost of their equipment evenly over its useful life.

  • Many companies use the straight-line method of depreciation to allocate the cost of their equipment over time.

  • The accountant recommended adopting the straight-line method of depreciation for the new software system.

  • The straight-line method of depreciation is commonly used by businesses.

  • Many accountants prefer the straight-line method of depreciation for its simplicity.

  • The accountant recommended the straight-line method of depreciation because it simplifies financial reporting.

  • Under the straight-line method of depreciation, the business deducts an equal amount from the asset's value each year.

Synonyms

straight-line method
vsstraight-line method of depreciation
  • Specialized
6.3

A way to spread an asset's cost equally over its useful life

is identical in meaning but written as the complete formal phrase

Surface Forms

straight-line method of depreciation singular
straight-line methods of depreciation plural

Morphology

straight-line + method + of + depreciation

The meaning is directly built from the constituents: 'straight-line' conveys a linear/constant pattern and combined with 'method' and 'depreciation' yields a method where depreciation is allocated evenly over time. This compositional reading is transparent and parallels equivalent constructions in other languages, so a B1 learner who knows the component words can infer the intended accounting sense.

Etymology

Straight-line method of depreciation comes from the image of a straight-line drawn from an item's full value down to zero, showing depreciation as an even drop. So the phrase means 'spreading the same cost across each year'.