According to H.W. Fowler's delightfully stern guide to English grammar, "The King's English", the correct usage of will and shall has several contributing factors.

Firstly, in Old English the terms were used without an association with the future. "Shall" was concerned with an obligation, and "will" with a wish. Because commands and wishes are fulfilled in the future, tense auxiliary forms grew out of this usage.

In the "coloured future" the terms retain their association with obligation and desire. So "I shall write this report" implies that I am required to write it, and "I will write this report" implies that I want to write it.

The correct usage stems from the idea that "I shall..." is redundant because one doesn't command oneself to do something. "Shall I..." is fine. "I will... ", "We will...", "Will she...?" and "Will they...?" are fine, however "You will..." doesn't work, because we don't know the other's mind.

Those who wish for a fuller understanding of this area and how it impacts other tenses and usages could try struggling though Fowler's 1908 edition of the work, at http://www.bartleby.com/116/213.html.

But as the man himself notes about the difference between will and shall...:

"It is unfortunate that the idiomatic use, while it comes by nature to southern Englishmen (who will find most of this section superfluous), is so complicated that those who are not to the manner born can hardly acquire it; and for them the section is in danger of being useless. In apology for the length of these remarks it must be said that the short and simple directions often given are worse than useless. The observant reader soon loses faith in them from their constant failure to take him right; and the unobservant is the victim of false security. "