Depreciation is used to allocate the cost of fixed assets, such as machinery and equipment, over their depreciable life. For each fixed asset, you must define how it will be depreciated.
There are two ways to post depreciation:
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Manually, using the FA G/L journal or the FA journal.
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Automatically, by running the Calculate Depreciation batch job.
The program can calculate daily depreciation, thus allowing you to calculate depreciation for any period. You can therefore analyze current operating results on, for example, a monthly, quarterly, or annual basis.
The program uses a standard year of 360 days and a standard month of 30 days in the calculation.
Allocating Depreciation
If a fixed asset is used by several departments, periodic depreciation can be automatically allocated to these departments according to a user-defined allocation table.
Canceling Incorrect Entries
You can cancel incorrect depreciation entries. This can be done with the Cancel FA Ledger Entries batch job. After this, you can post the correct amount of depreciation by running the Calculate Depreciation batch job again.
When you correct errors, they are posted as FA error ledger entries.
Indexation
Indexation is used to adjust values for general price-level changes. The Index Fixed Assets batch job can be used to recalculate the depreciation amounts.
The following table describes a sequence of tasks, with links to the topics that describe them. These tasks are listed in the order in which they are generally performed.
| To | See |
|---|---|
Run the Calculate Depreciation batch job. | |
Post to a depreciation book for which depreciation does not have general ledger integration. | How to: Post Depreciation Manually by Using Fixed Asset Journals |
Use the FA G/L journal to post depreciation when you are posting to a depreciation book for which depreciation has general ledger integration. | How to: Post Depreciation Manually by Using Fixed Asset General Ledger Journals |
Fill in journal lines to be posted to a depreciation book, and then duplicate the lines in a separate journal, from which they can be posted to a different depreciation book. | |
Copy entries from one depreciation book to another with the Copy Depreciation Book batch job. | |
View, correct, and cancel FA ledger entries, cancel and recalculate depreciation, trace FA transactions, and view and print FA registers. | |
See posted amounts per asset and depreciation book. | |
Print a report about depreciation, acquisitions, and disposals for a selected period, as well as book value at the end of the period | |
Show amounts posted in the general ledger that are from the Fixed Assets application. |