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