Note: Any value entered in Accumulated depreciation Field system will calcualted depreciation for Current Period only. If no value entered in depreciation Field system will calculate depreciation from beginning of the asset.
Case Study 1: Create a new asset, With Accumulated Depreciation(let's say X) and YTD Depreciation.
Run Depreciation to Calculate current Method Depreciation. In Accumulated Deprecation , system will calculated current method Depreciation
and add to accumulated deprecation as entered while creating asset(X Value + current Period Depreciation)
while running create Accounting. System will Generated accounting
Entry for Asset addition and Current month Depreciation but no accounting entry will be created for accumulated Depreciation entered while Creating Asset..
If Accumulated Depreciation is entered, System will calculated Depreciation for current Period only.
Illustration:
Asset Cost: 10000
Accumulated Depreciation: 500
Date Place in Service : 01-JAN-2013
Depreciation Method Life: 40 Yrs. (480 Months)
After Running Depreciation for MAR-16
Deprecation calculate for the period= Asset Cost/ Life in months= 10000/480= 20.83
Now
Accumulated Depreciation will be 500+ 20.83= 520.83.
Accounting entry will be generated for Asset Addition as below
Asset Cost A/c............Dr 10000
To Asset Clearing A/c.......................Cr 10000
Accounting entry will be generated for Depreciation as below
Depreciation A/c..............Dr 20.83
To Accumulated Depreciation A/c....20.83
Note: No Accounting will be generated for Accumulated Deprecation entered before running Depreciation.
Case Study 2: Create a new asset, With Accumulated Depreciation as null and YTD Depreciation as null and when you save record. System will create YTD Deprecation and
accumulated Depreciation till Previous Period.
Run Depreciation to Calculate current Method Depreciation.
while running create Accounting. System will Generated accounting
Entry for Asset addition and Current month Depreciation but no accounting entry will be created for accumulated Depreciation.
If Accumulated Depreciation is entered, System will calculated Depreciation for currrent Period only.
Illustration:
Asset Cost: 10000
Accumulated Depreciation: NULL
YTD Depreciation: NULL
Date Place in Service : 01-JAN-2013
Depreciation Method Life: 40 Yrs.
after Running Depreciation for MAR-16
Deprecation calculate from Date place in Service: 20.83 (Dep per Month)* 39(Till Current Month)= 812.5
Now
Accumulated Depreciation will be = 812.5
YTD Depreciation will be=812.5.
Accounting entry will be generated for Asset Addition as below
Asset Cost A/c............Dr 10000
To Asset Clearing A/c.......................Cr 10000
Accounting entry will be generated for Depreciation as below
Depreciation A/c..............Dr 812.5
To Accumulated Depreciation A/c....812.5
Note: Depreciation Accounting will be generated from Date place in service to till Date
