Depreciation calculation for added assets

After choosing to have a previous depreciation that is calculated at the time an asset is added, the entire catch-up depreciation for the previous depreciation periods is recovered at the end of the current period. The remaining periods in the year receive the regular depreciation.

Calculation Description
Compute Option Set to Yes
Journal entries that are generated at the addition time
  • Lease Debt, ROU Asset and Asset Clearing if the Lease Debt and ROU Asset are for different amounts.
  • Depreciation Expense (debit) and Accumulated Depreciation (credit)
    Note: A Posting Book must be added to all Leased Assets.
Result The asset book year-to-date amount for the current period is similar to the asset that is routinely depreciating since its in-service date.
Required additional steps If the in-service date for the asset is from a previous and closed year, then you must manually post Global Ledger journal entries for the accumulated depreciation of the prior year's depreciation expense.