Example: compute depreciation for previous period and current year
Assume that a lease is created for a computer that is placed in service in the previous month. Use the Compute Option in Asset Book to calculate depreciation expense for the prior month in Asset Management.
| System-generated entries | Debit | Credit |
|---|---|---|
| Asset | X | |
| Asset clearing | X | |
| Depreciation expense (previous period) | X | |
| Accumulated depreciation (previous period) | X |
Effect on General Ledger
The previous month depreciation amount is transferred to the General Ledger in the current month. The current month depreciation expense is calculated during fiscal period close.