Calculating depreciation on equipment is an important accounting practice for businesses of all sizes. Depreciation is the process of allocating the cost of an asset over its useful life. This helps businesses spread out the cost of the asset and its associated expenses over a period of time. By doing this, businesses can account for the cost of the asset in a more accurate and consistent manner. The most common method of calculating depreciation on equipment is the straight-line method. This method takes the cost of the asset and divides it by the estimated useful life of the asset. The resulting amount is the annual depreciation expense. Other methods of calculating depreciation on equipment include the declining balance method, sum-of-the-years digits method, and the units of production method. Each of these methods has its own advantages and disadvantages, so it is important to understand which method is best for your business. Regardless of the method used, calculating depreciation on equipment is an important accounting practice that helps businesses accurately track the cost of their assets.