Straight-line depreciation is a method used to allocate the cost of a tangible asset over its useful life. This approach assumes that the asset will lose value evenly over time. To calculate it, you subtract the asset's salvage value from its initial cost and then divide that amount by the number of years the asset is expected to be in use. For example, if a company buys a machine for $10,000 with a salvage value of $1,000 and a useful life of 9 years, the annual depreciation expense would be ($10,000 - $1,000) / 9 = $1,000. This means the company will record a $1,000 expense each year for 9 years.