Linear Depreciation is a method of accounting used to spread the cost allocation of a fixed asset over its expected lifespan. This process allows businesses to plan ahead and allocate their capital effectively, recognizing the long-term value of the asset. A key characteristic of this method is that it depreciates an asset by the same amount each year – rather than varying the amount depending on the asset’s age or condition. By taking this linear approach, businesses can make informed decisions about how often to replace assets, or when to invest in new ones. Effective use of Linear Depreciation can ensure that your business makes the most out of its resources for the long run.