This document discusses key concepts in financial mathematics related to depreciation. It defines simple and compound interest formulas. It explains the two types of depreciation - straight line and reducing balance. Straight line depreciation subtracts an equal amount each year from the purchase price of an asset. Reducing balance depreciation subtracts the greatest amount in the first year and smaller amounts each subsequent year. The document provides examples of calculating depreciation of various assets like a mountain bike, 4x4 vehicle, and lawn mower using the straight line method.