Key formulas
- Annual straight-line depreciation charge
- D = (P - S) / n
- Book value after k years
- BV_k = P - k*D
- Accumulated depreciation after k years
- accumulated = k * D
- Total depreciable basis
- P - S = n * D
- Consistency check
- BV_n = S
Straight-Line Depreciation and Book Value practice problems for the FE Civil exam
Straight-line depreciation spreads the loss in value of an asset evenly across its useful life, and it is the depreciation method the FE Civil exam expects unless another one is named. The annual charge is the amount the asset will actually lose, which is the initial cost minus the salvage value, divided by the number of years over which it is written down. Because the charge is the same every year, book value falls along a straight line from the initial cost to the salvage value, and the book value at the end of any year is the initial cost minus the depreciation taken so far. The salvage value is where candidates lose points. Depreciating the full purchase price ignores the fact that the asset is still worth something at the end, and the resulting annual charge is too large. The distractor built from that mistake is always present. Two related quantities are easy to interchange as well: accumulated depreciation is the total taken to date, while book value is what remains, and the two sum to the initial cost. Note also that book value under straight-line depreciation can never fall below the salvage value, so an answer smaller than salvage signals an arithmetic slip rather than a fast-depreciating asset.
Common mistakes
- Depreciating the full initial cost and never subtracting the salvage value.
- Reporting accumulated depreciation where the question asked for book value, or the reverse.
- Using the recovery period from a MACRS table when the question specified straight-line.
- Returning a book value below the salvage value, which straight-line depreciation cannot produce.
8 worked practice problems
Commit to an answer before opening the solution. Each problem shows the governing model, every substitution, a unit check, and why each wrong choice is wrong.
- 01EASYFor the Oak Point water storage yard, a civil analyst preparing an operations handoff review uses straight-line depreciation for an asset...
- 02EASYFor the Oak Point detention pond retrofit, a civil analyst preparing an independent quantity review uses straight-line depreciation for an...
- 03EASYFor the Bayshore water storage yard, a civil analyst preparing a capacity verification worksheet uses straight-line depreciation for an...
- 04EASYFor the Bayshore water storage yard, a civil analyst preparing a quality-control closeout uses straight-line depreciation for an asset with...
- 05EASYFor the Oak Point water storage yard, a civil analyst preparing an independent quantity review uses straight-line depreciation for an asset...
- 06EASYFor the Red River bridge widening, a materials reviewer preparing a commissioning data review uses straight-line depreciation for an asset...
- 07EASYFor the Mill Creek detention pond retrofit, a materials reviewer preparing a construction-phase calculation record uses straight-line...
- 08EASYDuring a quality control worksheet for the East Marsh treatment basin site access project, the project engineer uses straight-line...
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Background reading
Original question written by FE Exam AI Prep from the public FE Civil exam specification. Before release, a solver model re-derived the answer twice from the question alone, without its answer key, and a critic model checked the result. No licensed engineer reviews these questions. It is not an NCEES question and does not come from any NCEES practice exam. FE Exam AI Prep is an independent study tool and is not affiliated with, endorsed by, or sponsored by NCEES.