Which depreciation method allocates equal amounts of expense over the asset's life?

The straight-line method of depreciation is designed to allocate an equal amount of expense for each period over the asset's useful life. This approach starts with the initial cost of the asset, subtracts the estimated salvage value (the value the asset is expected to have at the end of its useful life), and divides this amount by the number of periods (usually years) the asset is expected to be used.

This method is straightforward and easy to apply, which is why it's one of the most common methods used by businesses. By generating a consistent expense amount each accounting period, it allows for straightforward financial planning and analysis.

In contrast, the other methods, such as the declining balance and sum-of-the-years'-digits methods, allocate different amounts of expense across the asset's lifespan, typically front-loading the depreciation expense in the earlier years. The units of production method ties depreciation to actual usage rather than time, making the expense variable based on how much the asset is used. Therefore, the straight-line method is the only one that ensures a consistent and equal allocation of expense over the asset's life.