Question

What are the advantages of the straight line method?

Answer 1

The following are the advantages of the straight line method of calculating depreciation:

1. It is simple to understand and apply.
2. The asset value can be completely written off using this method.
3. Asset value can be made zero value at the end of useful life.
4. It is easier to compare profits as an equal amount of depreciation is charged every year.
5. It is useful for those assets whose usage is made on a constant basis and the useful life of the asset can be determined easily.

Also read:

• True and False Questions on Depreciation
• What Is Depreciation
• MCQs on Depreciation

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