Defining asset types

  1. Click the Asset Types tab.
  2. In each Asset Type field, specify a description (up to 60 characters). The descriptions appear in the Asset Types list in the Asset Detail form.
  3. In the Depreciation Method list, select the depreciation method for this asset type. Detail Budgeting provides these methods:
    • Straight line
    • Sum-of-the-year's digits
    • Declining balance
    • Double declining balance
    • Depletion
    • Custom spread
    • None
    See the online help for detailed descriptions of how these methods are calculated. Using a custom spread method enables you to depreciate using methods other than those supplied by Detail Budgeting. Using no depreciation method enables you to create asset types that are not depreciated.
  4. In the Service life (years) field for each asset type, specify the service life in terms of years (between 0 and 1000).
  5. In the Service life (months) list for each asset type, select the service life in terms of months (between 1 and 11). If you want to indicate 30 months, type 2 in the Service Life Years field, and select 6 from the list in Service Life Months.
  6. In the Depreciation Lag field for each asset type, specify the lag after the acquisition date, in months, before depreciation should begin. Depreciation Lag does not extend Service Life. This is optional.
  7. Optionally, in the Minimum Cost field, specify the minimum amount that an item must cost to qualify for capitalization instead of expense. Budget holders cannot specify assets that cost less than this amount. The maximum value you can specify is 9,999.99.
  8. If you are using a minimum cost, you must also select how the acquisition cost should be compared with the minimum cost in the Capitalization Rule field. The options are Each Item or All Items. If you select Each Item, the acquisition cost per item must exceed the minimum cost. If you select All Items, the acquisition cost for the group as a whole must exceed the minimum cost.
    For example, if a budget holder acquires four chairs at $250 apiece and the minimum cost for capitalization of chairs is $500 for each item, then the budget holder would not be able to save the record on the Asset Detail form, because the cost of $250 per chair is less than the minimum cost of $500 for each item. But if the minimum cost of chairs is $500 for all items, then the budget holder would be able to save the record, because the price of the group of four chairs as a whole ($1,000) exceeds the minimum cost for all the items.
  9. If you are using the Depletion or the Custom Spread depreciation method, specify the total number of units for this asset type in the Total Units field. If you do not specify a value, the system automatically calculates it for you when you save the asset type.
  10. If you are using the Custom Spread depreciation method, select a spread method from the Spread Method list.
  11. In the Residual Value % field, specify the percentage value of the original acquisition cost that assets of this type should have at the end of the depreciation cycle. Specify the percentage as a whole number. For example, fifteen percent is specified as 15, not 0.15. The value must be between 0 and 100.
  12. In the Additional Cost % field, specify the percentage of any additional costs associated with the asset type (for example, sales tax or freight). Specify the percentage as a whole number. For example, fifteen percent is specified as 15, not 0.15. The value must be between 0 and 100.