Net Book Value (NBV)-oriented depreciationThe net book-value (NBV) oriented depreciation method is a variant of the declining balance depreciation method. In this method, the declining balance percentage is set for a period of a year. The computation is as follows: depreciation amount = net book value * (declining percentage/100) where: NBV = Net Book Value US tax books NBV = (cost - salvage - sec179) * (business percentage/100) - AD Other books NBV = cost - salvage - AD periodic depreciation = NBV * (declined balance percentage/100) * (periods depreciated/periods in fiscal year) daily depreciation = NBV * (declined balance percentage/100) * (days depreciated/days in fiscal year) For MACRS and ACRS, the salvage value is not applied to the depreciation of US tax and commercial books. Straight-line calculation If you use a depreciation method and the Switch to SL check box is selected in the Depreciation Methods (tffam7510m000) details session, LN applies either of these calculations:
LN applies these calculations according to the SL Switch Criteria defined in the FAM Parameters (tffam0500m000) session. The switch occurs in the first period in which the straight-line calculation results in a larger depreciation amount than the NBV-oriented depreciation.
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