Cost Percentage Depreciation Method
Cost Percentage
When the depreciation amount of an asset is calculated based on
the cost percentage, the Depreciation Method field is set to Cost Percentage in the Depreciation Method (tffam7110s000) session. The Cost Percentage must also be specified in this
session as the depreciation amount is always calculated as a percentage of the
current asset cost, instead of the asset life. When the Depreciation Method is specified, LN checks if
the adjustment date is within the life of the asset. However, this check is not
applicable for the Cost Percentage method of depreciation. The Calculation Base field is used to indicate whether
the percentage is applied on a Yearly or Periodically basis.
Example
| Example 1 | Example
2 |
| Depreciation Method | Straight Line | Cost
Percentage |
| Cost Percentage | Not
Applicable | 50 |
| Calculation Base | Not
Applicable | Yearly |
| Asset Life | 2 Years | 2
Years |
| | |
| Acquistion Cost 2015
/ 1 | 2400 | 2400 |
| Depr 2015 /
1 | 100 | 100 |
| Depr 2015 /
2 | 100 | 100 |
| Depr 2015 /
3 | 100 | 100 |
| Depr 2015 /
4 | 100 | 100 |
| Depr 2015 /
5 | 100 | 100 |
| Depr 2015 /
6 | 100 | 100 |
| Depr 2015 /
7 | 100 | 100 |
| Depr 2015 /
8 | 100 | 100 |
| Depr 2015 /
9 | 100 | 100 |
| Depr 2015 /
10 | 100 | 100 |
| Depr 2015 /
11 | 100 | 100 |
| Depr 2015 /
12 | 100 | 100 |
| Cost Adjustment 2016 /
1 | 1200 | 1200 |
| Depr 2016 /
1 | 200 | 150 |
| Depr 2016 /
2 | 200 | 150 |
| Depr 2016 /
3 | 200 | 150 |
| Depr 2016 /
4 | 200 | 150 |
| Depr 2016 /
5 | 200 | 150 |
| Depr 2016 /
6 | 200 | 150 |
| Depr 2016 /
7 | 200 | 150 |
| Depr 2016 /
8 | 200 | 150 |
| Depr 2016 /
9 | 200 | 150 |
| Depr 2016 /
10 | 200 | 150 |
| Depr 2016 /
11 | 200 | 150 |
| Depr 2016 /
12 | 200 | 150 |
| Depr 2017 /
1 | | 150 |
| Depr 2017 /
2 | | 150 |
| Depr 2017 /
3 | | 150 |
| Depr 2017 /
4 | | 150 |
| | |
| Acc.
Depreciation | 3600 | 3600 |
Apply Cost Adjustment in the next Period
You must select the Apply Cost Adjustment in next Period check box in the Depreciation Method (tffam7110s000) session, to ensure that the depreciation calculation
considers all cost changes in a certain period to be applied on the start date
of the next period.
Example
| Example 1 | Example
2 |
| Apply Cost Adjustment in next
Period | No | Yes |
| Cost
Percentage | 20 | 20 |
| Calculation
Base | Yearly (12 periods) | Yearly (12
periods) |
| | |
| Acquisition Cost
2015 / 11 | 100000.00 | 100000.00 |
| Depr 2015 /
11 | 1666.67 | 1666.67 |
| Depr 2015 /
12 | 1666.67 | 1666.67 |
| Depr 2016 /
1 | 1666.67 | 1666.67 |
| Cost Adjustment start date
of 2016 / 2 | 2000.00 | 2000.00 |
| Depr 2016 /
2 | 1700.00 | 1666.67 |
| Depr 2016 /
3 | 1700.00 | 1700.00 |
Salvage in Last Period
If the Salvage in last Period check box is cleared in the Depreciation Method (tffam7110s000) session, the asset is depreciated to a Net Book Value
which is equal to the salvage value. Consequently, the Net Book Value is
calculated by subtracting the salvage value from the cost amount before
calculating the depreciation amount.
If the Salvage in last Period check box is selected, the
depreciation is calculated based on the calculation method, when Depreciate Below Salvage check box is selected in the Asset Books (tffam1510m000) session, that is, considering that there is no salvage
value of the asset. However, when the accumulated depreciation is greater than
the cost minus salvage value, the depreciation amount is corrected with the
salvage value.
| Example 1 | Example
2 | Example 3 | Example 4 |
| Depreciate Below
Salvage | Yes | No | No | No |
| Salvage
in Last
Period | No | No | Yes | Yes |
| Salvage
Value | 48 | 48 | 48 | 360 |
| Cost
Percentage | 50 | 50 | 50 | 50 |
| Calculation
Base | Yearly | Yearly | Yearly | Yearly |
| | | | |
| Acquisition
Cost 2015 /
1 | 2400 | 2400 | 2400 | 2400 |
| Depr
2015 / 1 | 100 | 98 | 100 | 100 |
| Depr
2015 / 2 | 100 | 98 | 100 | 100 |
| Depr
2015 / 3 | 100 | 98 | 100 | 100 |
| Depr
2015 / 4 | 100 | 98 | 100 | 100 |
| Depr
2015 / 5 | 100 | 98 | 100 | 100 |
| Depr
2015 / 6 | 100 | 98 | 100 | 100 |
| Depr
2015 / 7 | 100 | 98 | 100 | 100 |
| Depr
2015 / 8 | 100 | 98 | 100 | 100 |
| Depr
2015 / 9 | 100 | 98 | 100 | 100 |
| Depr
2015 / 10 | 100 | 98 | 100 | 100 |
| Depr
2015 / 11 | 100 | 98 | 100 | 100 |
| Depr
2015 / 12 | 100 | 98 | 100 | 100 |
| Depr
2016 / 1 | 100 | 98 | 100 | 100 |
| Depr
2016 / 2 | 100 | 98 | 100 | 100 |
| Depr
2016 / 3 | 100 | 98 | 100 | 100 |
| Depr
2016 / 4 | 100 | 98 | 100 | 100 |
| Depr
2016 / 5 | 100 | 98 | 100 | 100 |
| Depr
2016 / 6 | 100 | 98 | 100 | 100 |
| Depr
2016 / 7 | 100 | 98 | 100 | 100 |
| Depr
2016 / 8 | 100 | 98 | 100 | 100 |
| Depr
2016 / 9 | 100 | 98 | 100 | 40 |
| Depr
2016 / 10 | 100 | 98 | 100 | |
| Depr
2016 / 11 | 100 | 98 | 100 | |
| Depr
2016 /
12 | 100 | 98 | 52 | |
| | | | |
| Acc.
Depreciation | 2400 | 2352 | 2352 | 2040 |