Straight line foundation is a way of calculating depreciation and amortization, the procedure of expensing an asset over an extended time frame than while it changed into purchased.
The required details for Straight line method in given paragraph
Depreciation every yr beneath the Straight line technique = (Cost - Residual cost) / Useful life
= ($298,100 - $38,900) / 9
= $28,800
Accumulated depreciation on January 1 of Year 4 = $28,800 + $28,800 + $28,800
= $86,400
Book cost on January 1 of Year 4 = Cost - Accumulated depreciation
= $298,100 - $86,400
= $211,700
Cash$201,100
Accumulated depreciation$86,400
Loss on sale of Equipment ($211,700 - $201,100) = $10,600
Equipment $298,100
Cash= $215,900
Accumulated depreciation=$86,400
Gain on sale of Equipment = ($215,900 - $211,700)= $4,200
Equipment $298,100
Straight line depreciation is the default technique used to apprehend the sporting quantity of a hard and fast asset frivolously over its beneficial life. It is hired while there may be no precise sample to the way wherein an asset is to be applied over time.
Use of the straight-line technique is fantastically recommended, considering that it's miles the perfect depreciation technique to calculate, and so consequences in few calculation errors.
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