Answer Posted / krishnaiah

Depreciation: A gradual reduction of an asset value due to wear & tear called Depreciation.
Methods:
1.Straight Line Method (SLM)
2.Declining Balance Method/Written Down Method (WDM)

In SAP we calculate depreciation using Straight line method/written Down method: Means we have a combination of Base Method, Multilevel Method & Period Control Method.
Depreciation Key determines the actual method of as asset.

Straight line method calculates the depreciation on APC/Book value of an Asset.
Written down method calculates the depreciation on net value of an Asset.

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