Depreciation calculation at regular closing period
After you calculate the depreciation at the close of each period instead of adjusting, the asset catch-up depreciation is spread evenly over the remaining periods for the rest of the current year.
| Calculation | Description |
|---|---|
| Set Compute Option to | No |
| Journal entries that are generated at addition time | Asset (debit) and Asset Clearing (credit)
Note: Journal entries are only generated if a posting book is assigned to the asset.
|
| Result | The depreciation for the prior depreciation periods is fully recovered at the end of the current year. |
| Required additional steps | None |
| Comments | After you use the Compute Option of No for assets with in-service dates from the previous period, the displayed depreciation amounts are not the expected amounts. This process is finished because the depreciation must proceed at a higher amount per period than the prediction to create the basis depreciate of the asset to the end of its life. |